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concessions,2 the sole issue for decision is whether petitioner
is liable for the penalty. We hold that he is liable.
FINDINGS OF FACT
Some of the facts have been stipulated. The stipulation of
facts, the stipulation of settled issues, and the attached
exhibits are incorporated herein by this reference. Petitioner
resided in Gardena, California, at the time his petition was
filed.
On Schedule C, Profit or Loss From Business, of his 2000
Form 1040, U.S. Individual Income Tax Return, petitioner claimed
a business loss of $60,044 for a principal business or profession
listed as “Marketing Sales”. The loss comprised the following
claimed expenses: (1) $2,007 for advertising; (2) $7,471 for car
and truck expenses; (3) $24,944 for depreciation and section 179
expense deduction; (4) $1,960 for mortgage expenses; (5) $1,268
for travel; (6) $1,295 for meals and entertainment; and (7)
$21,099 for other expenses. The other claimed expenses included:
(1) $4,955 for donations at Bible college; (2) $8,707 for repairs
service; (3) $699 for tax preparation fees; (4) $980 for
2In a stipulation of settled issues, petitioner conceded
that he is liable for interest income of $68 and a taxable
distribution of $1,917, and that he is not entitled to Schedule
C, Profit or Loss From Business, expenses of $60,044. On brief,
respondent concedes that petitioner is not subject to the 10-
percent additional tax of $1,156 for early distribution under
sec. 72(t). The remaining adjustments contained in the notice of
deficiency are computational in nature and will be resolved by
the parties in the Rule 155 computation.
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