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On her second Schedule C for her Joyful Wedding business,
petitioner deducted a total of $12,871 in expenses. The amounts
claimed and the rounded amounts respondent conceded are set forth
below:
Deductions Respondent
Expenses Claimed Conceded
Advertising $3,725 $3,508
Bad debts 75
Office 406 438
Bank charges 194 113
Licenses 7,996 7,320
Misc. 267 75
Telephone 208 -
$12,871 $11,454
Petitioner did not have any other credible evidence. We find
that she is entitled to deduct $11,454 of expenses for the Joyful
Wedding business.
Petitioner reported $9,240 as other income from notary
public services. Respondent determined that the $9,240 was part
of petitioner’s gross receipts for MBS and that it was subject to
self-employment tax. Income from services as a notary public is
not subject to the self-employment tax. Sec. 1402(c); sec.
1.1402(c)-2(b), Income Tax Regs. However, petitioner had no
records of a notary public business or any other evidence to show
she was entitled to exclude $9,240 from self-employment income.
When asked about her notary records, petitioner stated: “It’s
just a lot of paperwork. I didn’t bring that. I didn’t bring
the details”. She did have a notary seal. Accordingly, we allow
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Last modified: May 25, 2011