Richard Gorkes, Jr. and Susan Gorkes - Page 3

                                        - 2 -                                         
               Respondent determined deficiencies in petitioners’ Federal             
          income taxes for the taxable years 1999, 2000, and 2001 in the              
          amounts of $3,961, $6,583, and $9,715 respectively.2                        
               After concessions by the parties, the sole issue for                   
          decision is whether petitioners are entitled to investment                  
          interest expense deductions for the taxable years 1999, 2000, and           
          2001 in excess of the amounts allowed by respondent.  We hold               
          that they are not.                                                          
          Background                                                                  
               Some of the facts have been stipulated, and they are so                
          found.  Petitioners resided in Lilburn, Georgia, at the time that           
          their petition was filed with the Court.                                    
               Petitioners timely filed their Form 1040, U.S. Individual              
          Income Tax Return, for the taxable year 1999.  Petitioners                  
          attached to their return Schedule A, Itemized Deductions, and               
          claimed an investment interest expense deduction of $31,215.                
          Petitioners calculated this amount on an attached Form 4952,                
          Investment Interest Expense Deduction, as shown below:                      










               2  All numbers are rounded to the nearest dollar.                      




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