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Respondent determined deficiencies in petitioner’s Federal
income taxes and accuracy-related penalties for 1999 and 2000 as
follows:
Accuracy-Related Penalty
Year Deficiency Section 6662(a)
1999 $26,424 $5,285
2000 23,569 4,714
After concessions by respondent,2 the issues for decision by
the Court are as follows: (1) Whether petitioner is entitled to
various Schedule C deductions in 1999 and 2000; (2) whether
petitioner is entitled to head-of-household filing status in 1999
and 2000; (3) whether petitioner is entitled to earned income
credits in 1999 and 2000; (4) whether petitioner received
proceeds from the sale of stock in 2000; and (5) whether
petitioner is liable for the accuracy-related penalties under
section 6662(a) for 1999 and 2000.
In addition, there are two computational matters, the
resolution of which is solely dependent on our disposition of the
disputed issue involving petitioner’s Schedules C.3
2 At trial, respondent conceded: (1) For 1999 and 2000,
petitioner is entitled to claim his son as a dependent; (2) for
1999, petitioner is entitled to a bad debt deduction on Schedule
C in the amount of $7,580; and (3) for 2000, petitioner is
entitled to the cost of goods sold and the deduction for “other
expenses--rent” as claimed on his Schedule C.
3 The computational matters, each of which involves both of
the taxable years in issue, are: (1) The amount of self-
employment tax under sec. 1401; and (2) the amount of the self-
(continued...)
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