- 2 - After concessions, the issues for decision are: 1. Whether interest that petitioner paid in 1993 and 1994 for loans that he used to acquire, renovate, and operate two nursing homes and to buy interests in the Sunbury building and Heritage Inn partnerships is trade or business interest. We hold that interest relating to the nursing homes is trade or business interest, but interest relating to the Sunbury building and Heritage Inn partnerships is not. 2. Whether petitioner may deduct net operating losses in 1994 that were carried forward from 1991 and 1993. We hold that he may not. 3. Whether petitioner is liable for additions to tax under section 6651(a) for failure to file timely income tax returns for 1993 and 1994. We hold that he is. 4. Whether petitioner is liable for the penalty under section 6662(a) for substantial understatement of tax for 1993 and 1994. We hold that he is to the extent the underpayments in 1993 and 1994 exceed the greater of 10 percent of the tax required to be shown on the return for each of those years, or $5,000. See sec. 6662(d)(1)(A). Section references are to the Internal Revenue Code in effect during the years in issue. Rule references are to the Tax Court Rules of Practice and Procedure.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Next
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