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Addition to Tax Accuracy-Related
Year Deficiency Under Sec. Penalty Under Sec.
6651(a)(1) 6662(a)
1993 $3,879 $970 $776
1994 8,627 2,157 1,725
1995 2,276 569 455
The issues remaining for decision2 are:
(1) Do petitioners have unreported Schedule C gross re-
ceipts for each of the years at issue in the amount determined in
the notice? We hold that they do.
(2) Are petitioners entitled to Schedule C deductions for
each of the years at issue for “Car and truck expenses” (Schedule
C car and truck expenses) in excess of the amount that respondent
allowed in the notice? We hold that they are not.
(3) Are petitioners required to include in income for each
of the years 1994 and 1995 certain insurance proceeds that they
received during each such year? We hold that they are.
(4) Are petitioners entitled for any of the years at issue
to a net operating loss deduction under section 172(a)? We hold
that they are not.
2At trial, petitioners conceded that if the Court were to
sustain respondent’s determinations with respect to Schedule C,
Profit or Loss From Business (Schedule C), of petitioners’ tax
return (return) for each of the years at issue, they would be
liable for self-employment tax for each of those years, as
determined in the notice of deficiency (notice). In that event,
they would be entitled to a self-employment tax deduction for
each of those years, as determined in the notice.
At trial, petitioners also conceded that if the Court’s
resolution of the issues remaining for decision were to result in
an underpayment for any of the years at issue, they would be
liable for any such year for the accuracy-related penalty under
sec. 6662(a).
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Last modified: May 25, 2011