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2002 and reflects $0.18 being deposited into the savings account
on December 31, 2002. The Statement of Account also reports that
petitioner’s checking account earned $12.99 of interest income in
2002. However, there is no evidence indicating whether that
amount was ever deposited in or credited to the checking account.
The IRS attempted to obtain information from Farmers with
respect to the gross distribution that it reported for
petitioner. As of the time of trial, the IRS had not obtained
any additional information from Farmers as to this amount.
Discussion
Unemployment Compensation
Under section 61(a)(1), “gross income” means all income from
whatever source derived. The general rule of section 85 is that,
“In the case of an individual, gross income includes unemployment
compensation.” Sec. 85(a). “Unemployment compensation” means
“any amount received under a law of the United States or of a
State which is in the nature of unemployment compensation.” Sec.
85(b).
Petitioner does not dispute that he received unemployment
compensation during 2002. Petitioner argued at trial that he did
not report the unemployment compensation because an IRS worksheet
said that it was not taxable. Petitioner’s posttrial
“clarification” memorandum argues that he did not report the
unemployment compensation because his “income from the Texas
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