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The potential NOL carryforward to the years at issue, based upon
petitioner’s 1980-86 returns as filed, is $108,007.10
There was no examination of the NOL carryforwards during the
audit and only a minimal examination of a portion of the NOL
carryforwards by the IRS Appeals Office. In support of the
alleged NOL carryforwards, petitioner testified that, because of
serious medical problems she experienced during 1982-86, her law
practice during those years operated at a loss, generating part
of the NOL carryforwards. Petitioner testified that the Schedule
E, Supplemental Income and Loss, losses generating the remaining
part of the NOL carryforwards arose from the rehabilitation of a
rental property. Toward the end of the trial, petitioner
introduced documentation in the form of deposit slips, canceled
checks, and payment receipts for both her Schedule C and Schedule
E income and expenses during 1978-83, but she did not offer any
10Petitioner’s potential loss carryforward arises out of the
following reported results for 1980-86:
Reported operating Operating loss
Year income (loss) utilization
1980 ($41,399) $7,382 carried
back to 1977
1981 4,354 Offset by 1980 loss
1982 (48,861) --
1983 (5,051) --
1984 14,599 Offset by 1980 loss
1985 (19,643) --
1986 (19,388) --
Petitioner also reported operating losses in 1978 and 1979
which were carried back to 1976 and 1977.
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