Richard and Judith Haeder - Page 11




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          Item          1989    1990    1991    1992    1993                          
          Insurance premiums  $2,657  $3,211  $4,018  $3,520  $3,936                  
          Out-of-pocket costs    146     986   6,369   1,048   3,834                  
          Total               2,803   4,197  10,387   4,568   7,770                   
          In the notice of deficiency, respondent determined that, although           
          petitioners had substantiated medical plan expense payments as              
          summarized above, petitioners were not entitled to deduct any of            
          the amounts petitioner claimed on the Schedules C for medical               
          plan expenses.  Respondent determined, however, that petitioners            
          were entitled to deduct substantiated medical expenses on their             
          Schedules A, Itemized Deductions, subject to the statutory                  
          limitations.  At trial, petitioner submitted medical and dental             
          statements that showed payments for dental expenses totaling                
          $136, $86, $5,529, and $338 for 1989, 1990, 1991, and 1992,                 
          respectively.  It is not clear from the record whether those                
          payments were included in the amounts previously submitted to the           
          IRS auditor during the audit of the returns for those years.                
          Legal and Professional Expenses                                             
               On the Schedules C for 1989, 1990, and 1991, petitioner                
          claimed legal and professional expenses of $175,5 $8,623, and               
          $4,305, respectively.  Petitioner claimed no deductions for legal           
          and professional expenses on the Schedules C for 1992 and 1993.             




               5Respondent made no adjustment relating to the legal and               
          professional expenses claimed for 1989.                                     





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