Wilbur T. Hawks, Sr., and Betty W. Hawks - Page 2

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          penalty under section 6662(a)1 of $2,965.80 for 2000 and                    
          $8,152.20 for 2001.                                                         
               The issues for decision are:                                           
               1.  Whether petitioners are entitled to more itemized                  
          deductions than respondent allowed.  We hold that they are not.             
               2.  Whether petitioners may claim net operating losses                 
          (NOLs) of $183,455 for 2000 and $110,367 for 2001.  We hold that            
          they may not.                                                               
               3.  Whether petitioners may deduct partnership losses of               
          $32,065 claimed on Schedule E, Supplemental Income and Loss, for            
          2001.  We hold that they may not.                                           
               4.  Whether petitioners are liable for the accuracy-related            
          penalty under section 6662(a) for 2000 and 2001.  We hold that              
          they are.                                                                   
               5.  Whether petitioners are liable for a penalty under                 
          section 6673 for instituting proceedings primarily for delay and            
          for maintaining frivolous or groundless positions.  We hold that            
          they are not.                                                               
               Computational adjustments will be required to resolve the              
          taxable amounts of petitioners’ Social Security benefits in 2000,           
          the amounts of petitioners’ standard deductions for 2000 and                
          2001, and the amounts of petitioners’ exemptions for 2001.                  


               1 Section references are to the Internal Revenue Code in               
          effect for the taxable years in issue.  Rule references are to              
          the Tax Court Rules of Practice and Procedure.                              




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