Barry John and Deborah Lee Houston Mangels - Page 3




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          Procedure.  The decision to be entered is not reviewable by any             
          other court, and this opinion should not be cited as authority.             
               Respondent determined a deficiency in petitioners’ Federal             
          income tax for 1997 of $7,896, an addition to tax under section             
          6651(a)(1) of $1,974, and an accuracy-related penalty under                 
          section 6662 of $1,579.  The issues for decision are:  (1)                  
          Whether Barry Mangels (petitioner) had unreported nonemployee               
          compensation of $27,429; (2) whether petitioner worked as an                
          independent contractor subject to self-employment tax; (3)                  
          whether petitioners failed to file a timely Federal income tax              
          return without reasonable cause; and (4) whether petitioners are            
          subject to an accuracy-related penalty under section 6662.                  
          Petitioners conceded receipt of $11,471 of unreported income.               
          Petitioners did not dispute or present evidence as to adjustments           
          in the notice of deficiency increasing interest income and                  
          cancellation of indebtedness income.  Accordingly, we deem these            
          issues to be conceded.                                                      
                                     Background                                       
               The stipulation of facts and accompanying exhibits are                 
          incorporated herein by reference.  Petitioners resided in                   
          Sarasota, Florida, at the time their petition was filed in this             
          case.                                                                       
               During the second half of 1997, petitioner worked as a                 
          “handyman” on a few projects for John Salvatore Parziale (Sal               
          Parziale).  Petitioner performed tile work, painting, and spackle           




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