Efrain J. and Josefina Xuncax - Page 18




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          Second, the invoice is made out to “24 Karat Gold Jean Co.”  When           
          questioned about this document at trial, Mr. Mendez explained:              
                    THE WITNESS:  This--there were a man came to my                   
               shop and asked me if I could sew his garment.  And                     
               somehow he start talking about, you know, our business                 
               to start because sewing was to--it was no good anymore.                
                    So we tried to do like partnership or so, like I                  
               was wanting to sew the clothes that he--our products to                
               start our own business.                                                
                    And we were going to call it 24 Karat Gold Jeans                  
               or so, but we never get to that.                                       
                    MR. SLOAT:  So whose business--was that a                         
               partnership between you and this other person?                         
                    THE WITNESS:  Yes.                                                
               Because this testimony would seem to confirm that the                  
          photography charges were incurred by a business entity other than           
          EJX (namely, a partnership between petitioners’ son and an                  
          unidentified man), we must conclude that the amount cannot be               
          deducted on petitioners’ Schedule C.                                        
               G.  Legal and Professional Services                                    
               As previously indicated, respondent has conceded that                  
          petitioners are entitled to include on their Schedule C $725 for            
          legal and professional services.  This position is based upon an            
          invoice and receipt reflecting payment for bookkeeping services.            
          We accept respondent’s concession.                                          











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