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Respondent determined deficiencies of $4,859, $279, and
$3,812 in petitioner's Federal income taxes for 1995, 1996, and
1997, respectively, and accuracy-related penalties under section
6662(a) of $46.20 and $756.46, respectively, for 1995 and 1997.
After concessions by respondent,2 the issues for decision
are: (1) Whether the statute of limitations under section 6501(a)
bars respondent from making assessments against petitioner for
the 3 years at issue; (2) whether certain adjustments to
petitioner's income for the 3 years at issue are correct; (3)
whether petitioner is entitled to itemized deductions for 1995
and for Schedule C trade or business expense deductions for 1996
in excess of amounts allowed by respondent; and (4) whether
petitioner is liable for the section 6662(a) penalty for the year
1997.3
2 On brief, respondent conceded that the disallowed
itemized deductions of $9,770 for 1995 should be reduced to
$4,142, that the disallowed Schedule C car and truck expenses of
$14,141 for 1996 should be reduced to $11,831, and that
petitioner was not liable for the sec. 6662(a) penalty for 1995.
3 Prior to trial, petitioner filed motions for entry of
decision in both docketed cases based on a letter from
respondent's Memphis, Tennessee, office that stated that, for
petitioner's 1995 and 1996 tax years, there was no tax, interest,
or penalties due. Respondent filed objections, which the Court
sustained. On brief, petitioner reasserted his claim. Although
that issue was resolved by the Court prior to trial, the Court
notes that petitioner's claim has no merit. The letter
petitioner relies on does not relate to the 1997 tax year, and,
moreover, with respect to the 1995 and 1996 tax years,
petitioner's account would not show any amount owing because the
(continued...)
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