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Respondent determined deficiencies of $17,170.70,
$16,615.35, and $4,476.02 in petitioners' Federal income taxes
for 1994, 1995, and 1996, respectively, and accuracy-related
penalties under section 6662(a) of $3,434.14, $3,323.07, and
$895.20 for those years.
Following concessions by the parties,2 the issues for
decision are: (1) Whether the tax home and principal place of
business of Robert B. Harris (petitioner) was Memphis, Tennessee,
or Los Angeles, California, during 1994; (2) whether petitioners
are entitled to deductions for home office expenses under section
280A for each of the years at issue; (3) whether petitioners are
entitled to deductions for Schedule C expenses for 1994, 1995,
and 1996 in excess of amounts allowed by respondent; and (4)
whether petitioners are liable for the accuracy-related penalty
under section 6662(a) for negligence or disregard of rules and
regulations for each of the years at issue. The remaining
adjustments in the notice of deficiency for the years at issue
are computational and will be resolved by the Court's holdings on
the aforementioned issues.
2 In the stipulation of facts, respondent conceded a
$26,335.72 unreported income adjustment for 1995. At trial,
respondent conceded petitioners’ entitlement to a deduction for
meals and entertainment expenses of $112.45 for 1994. On brief,
petitioners conceded that, during 1995 and 1996, petitioner’s tax
home and principal place of business was Los Angeles, California.
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