Mario O. and Elsie R. Garza - Page 3

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          is not reviewable by any other court, and this opinion should not           
          be cited as authority.                                                      
               Respondent determined deficiencies of $5,939, $5,472, and              
          $4,318 in petitioners’ Federal income taxes for 1999, 2000, and             
          2001, respectively.  Respondent also determined an accuracy-                
          related penalty under section 6662(a) in the amount of $863 for             
          2001.  The issues for decision are:  (1) Whether Mario O. Garza             
          (petitioner) received income from American Income Life Insurance            
          Co. (American Life) during 1999, 2000, and 2001 under section               
          61(a);  (2) whether petitioner is liable for self-employment                
          taxes for 1999, 2000, and 2001 under section 1401(a); and  (3)              
          whether petitioners are liable for the accuracy-related penalty             
          for 2001 under section 6662(a) for negligence, disregard of rules           
          or regulations, or a substantial understatement of income tax.2             
               Some of the facts were stipulated.  Those facts, with the              
          annexed exhibits, are so found and are made a part hereof.                  
          Petitioners’ legal residence at the time the petition was filed             
          was Fresno, California.                                                     
               At the time of trial, petitioner and his wife, Elsie R.                
          Garza (Ms. Garza), were seeking a divorce.  However, they were              


               2Respondent did not determine any penalty for the years 1999           
          or 2000.  Additionally, in the notice of deficiency, some of                
          petitioners’ itemized deductions for the 3 years at issue were              
          disallowed.  The notice of deficiency states that petitioners               
          agreed to those adjustments.  Petitioners did not challenge these           
          adjustments at trial.                                                       





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