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Respondent determined a deficiency in petitioner’s 1994
Federal income tax in the amount of $6,337. Respondent
disallowed petitioner’s deduction of $30,684 for expenses claimed
on a Schedule C, Profit or Loss From Business, on the grounds
that petitioner did not engage in an activity for the purpose of
making a profit. An automatic adjustment was made.
This Court must decide whether petitioner engaged in a
tutoring activity for profit within the meaning of section 183.
Some of the facts in this case have been stipulated and are
so found. Petitioner resided in Los Angeles, California, at the
time she filed her petition.
During 1994, petitioner was employed as a teacher with the
Los Angeles Unified School District (LAUSD). She earned wages of
$54,610. Petitioner taught at Richland Elementary School
(Richland). As a teacher at Richland, petitioner taught first
grade students from January through June 1994, and third and
fourth grade students from September through December 1994.
On her Federal income tax return for 1994, petitioner
claimed deductions for an alleged activity she called
Conversation with Connection (CWC). In the alleged activity CWC,
petitioner claimed she tutored students (not at or from Richland)
about the use of computers. The year at issue was the second
year that petitioner’s tax returns reflected the alleged activity
called CWC.
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