Frederick Douglas Abdullah - Page 7

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               On a second Schedule C petitioner reported the income from             
          Matheson as $5,778 gross receipts.  The nature of the business              
          was listed as “Trucking - General Freight & Postal” (Schedule C             
          trucking).  Petitioner claimed deductions on this Schedule C as             
          follows:                                                                    
                    Expenses                           Amount                         
                    Advertising                        $636                           
                    Car and truck expenses             2,307                          
                    Repairs and maintenance            475                            
                    Taxes and licenses                 150                            
                    Meals and entertainment            756                            
                           Total                  4,324                               
               The notice of deficiency determined that petitioner was not            
          entitled to the $22,312 expenses ($18,710 plus the $3,602 of home           
          office expenses), claimed on the Schedule C pipefitting.  No                
          adjustment was made with respect to the income, except that                 
          respondent allowed petitioner a $299 self-employment tax                    
          deduction.  Respondent made no adjustments to the Schedule C                
          trucking in the notice of deficiency.                                       
               In an answer filed with the Court, respondent claims an                
          increased deficiency and seeks to correct adjustments from the              
          notice of deficiency.  Respondent claims that the gross receipts            
          reported on the two Schedules C should be treated as salary or              
          wages.  Consistent with this, respondent seeks to reverse the               
          $299 self-employment tax deduction previously allowed in the                
          notice of deficiency.  Finally, respondent claims that petitioner           
          is not entitled to the $4,324 Schedule C trucking expenses.                 





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Last modified: May 25, 2011