John D. Fairchild - Page 3




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          B.   Stan’s Pawn Shop                                                       
               Petitioner owned Stan’s Pawn Shop.  He occasionally went to            
          the shop to oversee its operations.  His former best friend and             
          his nephew managed the shop.  His parents also worked there.                
          Petitioner did not draw paychecks, have regular work hours, or              
          receive Forms W-2, Wage and Tax Statement, or Forms 1099-MISC,              
          Miscellaneous Income, from Stan’s Pawn Shop.                                
               Stan’s Pawn Shop did not file a partnership return or                  
          Schedule K-1, Partner’s Share of Income, Credits, Deductions,               
          Etc., for 1993.                                                             
          C.   Sale of Stock                                                          
               In 1993, petitioner sold Hartmarx stock for $3,471, Keller             
          stock for $11,296.20, and TINT stock for $8,013.04.  His basis              
          was $1,959.65 for the Hartmarx stock, $11,123.80 for the Keller             
          stock, and $5,315.52 for the TINT stock.  In 1993, he also                  
          received $12,560 from the sale of Cats 0% stock.3                           
          D.   Petitioner’s 1993 Income Tax Return                                    
               Petitioner received an extension to August 15, 1994, to file           
          his 1993 Federal income tax return.  He filed his 1993 return on            
          February 2, 1995.                                                           
               Petitioner deducted $900 for self-employment health                    
          insurance on his 1993 Form 1040, Individual Income Tax Return.              



               3  There is no evidence in the record of petitioner’s basis            
          in the Cats 0% stock.                                                       





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