- 48 -
fact, compensate her for any such services.40
On the record before us, we find that petitioners have
failed to show that Burien Nissan permitted Ms. Whitehead to use
certain Burien Nissan automobiles in order to compensate her for
any services that she performed and not to compensate Mr. White-
head for the services that he performed for Burien Nissan. We
find on that record that the fair market value of Ms. Whitehead’s
use of certain Burien Nissan automobiles during the years at
issue constitutes a fringe benefit provided by Burien Nissan to
Mr. Whitehead and is includible in petitioners’ income for those
years as wages to Mr. Whitehead. See sec. 1.61-21(a)(4)(i),
Income Tax Regs. On the record before us, we further find that
petitioners have failed to establish that the fair market value
of Ms. Whitehead’s use of certain Burien Nissan automobiles
during the years at issue is equal to the value that they re-
ported for such use in their joint return for each of those
years.
Based on our examination of the entire record before us, we
find that petitioners have failed to carry their burden of
establishing error in the determinations of respondent to include
in petitioners’ taxable income for 1996 and 1997 the net amounts
of $5,850 and $6,600, respectively, as a result of petitioners’
40As discussed supra note 39, Ms. Whitehead could have
performed certain services for Burien Nissan gratuitously upon
the request of her husband.
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