Braun Michael and Twanda B. Cameron - Page 10

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               By letter dated December 27, 2000, the Comptroller of                  
          Maryland confirmed that petitioners’ 1996 Maryland State Tax                
          Return, as filed, resulted in an overpayment of $2,532.853 of               
          which $2,191.32 was refunded to petitioners and $361.53 was                 
          offset to the Maryland State Central Collections Unit.  There is            
          no evidence in the record explaining what the offset represents.            
               With certainty, we can state that this deduction reduced               
          petitioners’ 1996 Federal income tax liability, and, therefore,             
          the Maryland State tax refund received in 1997 is includable in             
          gross income.                                                               
               Accordingly, we sustain respondent and hold that $2,552 is             
          includable in petitioners’ income for 1997.                                 
               We have considered all arguments made by the parties, and,             
          to the extent not discussed above, conclude they are irrelevant             
          or without merit.                                                           
               Reviewed and adopted as the report of the Small Tax Case               
                                                  Decision will be entered            
                                             under Rule 155.                          

               3    The letter from the Comptroller of Maryland appears to            
          have a typographical error, i.e., this number should be $2,552.85           
          instead of $2,532.85 ($2,191.32 + $361.53 = $2,552.85).                     

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