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Respondent determined a deficiency in Federal individual
income tax against petitioner for 1999 in the amount of $523.
The issue for decision is whether petitioner’s net loss from
her trade or business of providing cleaning and lawn mowing
services must be subtracted from her Form W-2 income in
determining her “earned income” under section 63(c)(5)(B),
relating to limitation on basic standard deduction in the case of
certain dependents.
The instant case was submitted fully stipulated; the
stipulations, stipulated exhibits, and other exhibits received at
the hearing are incorporated herein by this reference.
Background
When the petition in the instant case was filed, petitioner
resided in Washington, Missouri; she also resided there during
1999, the year in issue.
On her timely filed 1999 income tax return--
(1) petitioner claimed a tax filing status of
single;
(2) petitioner did not claim a personal exemption
deduction, instead that deduction was claimed on her
parents’ tax return (see sec. 151(d)(2)); and
(3) petitioner claimed a standard deduction of
$4,300.
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