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After a concession by petitioners,1 the issues for decision
are: (1) Whether petitioners are entitled to claimed itemized
deductions or to the standard deduction in lieu thereof; (2)
whether petitioners are entitled to a deduction for car and truck
expenses for their business; and (3) whether petitioners are
entitled to a deduction for legal and professional expenses for
their business.2
Some of the facts have been stipulated and are so found.
The stipulations of fact and the attached exhibits are
incorporated herein by this reference. In addition, certain
facts are deemed to have been admitted by petitioners, as
discussed below. Petitioners resided in Columbia Heights,
Minnesota, on the date the petition was filed in this case.
Petitioners filed a joint Federal income tax return for the
taxable year 1997. On the return, petitioners claimed a
miscellaneous itemized deduction for employment agency fees of
$5,300. Filed with the return was a Schedule C, Profit or Loss
From Business, for a “service-insurance” business named “NP
Snyder Agency,” on which petitioners claimed deductions for,
1At trial petitioners conceded the correct amount of the
State income tax refund includable in income is $2,463, rather
than $949 as reported on their return.
2Adjustments to self-employment income tax and the deduction
therefor are computational and will be resolved by the Court’s
holding on the issues in this case.
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Last modified: May 25, 2011