John R. Hernandez - Page 6




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               On the 1994 joint Federal income tax return that he and his            
          late wife filed, petitioner reported taxable interest income of             
          $6,085 and tax-exempt interest income of $28,635.2  Respondent              
          determined that the interest income petitioner received from the            
          redemption of tax certificates was not tax exempt.  Respondent              
          further determined that petitioner failed to report interest                
          income of $7,482.  This amount represents interest reported on              
          Forms 1099, which listed copayees’ Social Security numbers.                 
          Respondent also determined that petitioner failed to report                 
          interest income from First Union National Bank of $99 and                   
          interest income from Bankers Trust of $6.  Accordingly,                     
          respondent determined that petitioner failed to report taxable              
          interest income of $36,221.                                                 
               In the present case, petitioner concedes $28,739 of the                
          $36,221 interest income adjustment contained in the notice of               
          deficiency.  The interest income from First Union National Bank             
          and Bankers Trust is not disputed by petitioner.  Petitioner also           
          does not argue that the interest income reported on the Forms               
          1099 issued by the tax collector is tax exempt.  Instead,                   
          petitioner contends that the interest income represented by Forms           
          1099 listing copayees’ Social Security numbers should not be                


          2    In the deficiency notice respondent determined that the                
          amount should have been $28,634, apparently because of an                   
          arithmetic error.                                                           







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