- 2 -
163(h)(2)(A), I.R.C. 1986, and therefore as not being
deductible under ch. 1, I.R.C. 1986, these regulations are
valid.
2. Held, further, Redlark v. Commissioner, 106 T.C. 31
(1996), revd. and remanded 141 F.3d 936 (9th Cir. 1998),
will no longer be followed.
3. Held, further, Ps are not entitled to deduct the
interest they paid in 1995 on account of the underpayment of
their 1987 income tax liability.
Charles B. Sklar1, for petitioners.
Joseph Ineich, for respondent.
CHABOT, Judge: Respondent determined a deficiency in Federal
individual income tax for 1995 against petitioners in the amount
of $29,879.2 The issue for decision is whether petitioners may
deduct for 1995 the interest they paid in 1995 on their 1987
Federal individual income tax underpayment.3
1 Cheryl R. Frank and Gerald W. Kelly, Jr., appeared on
petitioners’ behalf at the trial. A few months later, before
filing any briefs, they moved for leave to withdraw as counsel;
the Court granted their motion. Later Charles B. Sklar entered
his appearance and thereafter represented petitioners on brief.
2 Of this total, $28,015 is income tax under ch. 1 and
$1,864 is self-employment tax under ch. 2.
Unless indicated otherwise, all section and chapter
references are to sections and chapters of the Internal Revenue
Code of 1986 as in effect for 1995. The section references in
table 1, infra, are to this Code as in effect for 1987.
3 Respondent disallowed petitioners’ $69,617 deduction of
(continued...)
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