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Respondent determined deficiencies in petitioners’ Federal
income taxes of $8,993 and $5,053, and accuracy-related penalties
of $1,799 and $1,011, respectively, for the taxable years 1995
and 1996.
The issues for decision are: (1) Whether petitioners are
entitled to charitable contribution deductions in 1995 and 1996;
(2) whether petitioners are entitled to certain miscellaneous
itemized deductions in 1995 and 1996 and business expense
deductions in 1995; and (3) whether petitioners are liable for
accuracy-related penalties under section 6662(a) for 1995 and
1996.1
Some of the facts have been stipulated and are so found.
The stipulations of fact and the attached exhibits are
incorporated herein by this reference. Petitioners resided in
Highlands Ranch, Colorado, on the date the petition was filed in
this case.
Charitable Contribution Deductions
During the years in issue, petitioner husband (petitioner)
was the director of Alpha Ministries. Petitioners provided
nearly all of the funds used by Alpha Ministries, and nearly all
of these funds were in turn used to pay for expenses of
1Petitioners concede respondent’s determination that they
received $123 in unreported interest income in 1995. Respondent
determined that petitioners were entitled to unclaimed deductions
in 1995 of $463 for investment interest expense and $62 for
business office expense.
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