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of the Schedule A deductions and $19,115 of the Schedule C
deductions. The deductions were disallowed because petitioners
did not establish that the expenses were paid or incurred during
the taxable year. Petitioners conceded that respondent’s
determinations were correct.
On each return, petitioners claimed $15,480 of rent expense
of business property. Gary explained that the accountant said
they could deduct a percentage of the rent on their home as an
office. Rent for the home was $950 per month or $11,400 a year.
Petitioners deducted more than 100 percent of the rent and
claimed a deduction of $15,480 for each year in issue.
Petitioners conceded that they did not incur rent expenses of
$15,480 with respect to Gary’s sole proprietorship electrician
business, as claimed for each of the years at issue. The $15,480
amounts were included in the Schedule C adjustments made by
respondent for each year. As a result of these rent deductions
and others, petitioners showed a Schedule C loss of $16,708 on
their 1996 return and a Schedule C loss of $16,800 on their 1997
return.
Each party claims relief from joint and several liability
pursuant to section 6015(b) and (c). Each party must satisfy
each requirement set forth in section 6015. Braden v.
Commissioner, T.C. Memo. 2001-69. The fact that one or the other
of petitioners must be the individual who caused an
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Last modified: May 25, 2011