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The issues for decision are:
1. Whether petitioner Austin L. Mitchell operated his farm
for profit in 1995, 1996, and 1997. We hold that he did not.
2. Whether petitioners converted their personal residence
to rental property in 1995. We hold that they did not.
3. Whether petitioners are liable for accuracy-related
penalties under section 6662(a) for negligence or substantial
understatement of income tax for 1995, 1996, and 1997. We hold
that they are.
References to petitioner are to Austin L. Mitchell.
References to Mrs. Mitchell are to petitioner Rebecca A.
Mitchell. Unless otherwise indicated, section references are to
the Internal Revenue Code for the taxable years in issue, and all
Rule references are to the Tax Court Rules of Practice and
Procedure.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
A. Petitioners
Petitioners lived in Salem, Missouri, when they filed their
petition. Petitioner has been a certified public accountant
since 1976 and is also a lawyer. He practiced law and accounting
during the years in issue. Mrs. Mitchell is a teacher.
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