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Finally, we address a point petitioners raised at trial.
Petitioners assert that the explanation in the notice of
deficiency regarding the disallowance of the Schedule C expenses
was too vague to allow for an adequate response. We agree that
the explanation as a whole suffers from a certain lack of clarity
or specificity. However, the notice of deficiency in effect sets
forth several alternative theories under which respondent
determined that petitioners are not entitled to any of the
Schedule C deductions. The Commissioner generally is permitted
to set forth alternative grounds for adjustments in a notice of
deficiency, as well as to take alternative positions at trial.
Doggett v. Commissioner, 66 T.C. 101 (1976). On account of our
holding, however, we need not address every such argument
respondent raised in this case.
Reviewed and adopted as the report of the Small Tax Case
Division.
Decision will be entered
for respondent.
3(...continued)
purchaser as “Edith Littlefield Sundby, SBMI Interiors”. Another
invoice labeled “office decorative fabric for couch” listed the
purchaser only as “SBMI Interiors”, while numerous other invoices
for similar items list only petitioner wife as the purchaser. No
mention is made of SBMI Interiors elsewhere in the record, and
petitioners have not argued that petitioner wife was engaged in a
trade or business of any type, other than with respect to the
$866 in income that she received from Personalized Workout of La
Jolla, Inc.
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