Ralph E. and Mildred E. Galyen - Page 2

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               Held, further:  Ps are not entitled to claim a deduction               
          under sec. 162, I.R.C., with respect to the AdaCom program.                 

               Scott M. Estill and Stephanie F. Long, for petitioners.                
               Richard D. D’Estrada, for respondent.                                  

                       MEMORANDUM FINDINGS OF FACT AND OPINION                        
               VASQUEZ, Judge:  Respondent determined deficiencies of                 
          $3,323, $3,556, and $3,126 in petitioners’ Federal income tax for           
          2000, 2001, and 2002, respectively.                                         
               The issues for decision are:                                           
               (1) Whether petitioners are entitled to claim a tax credit             
          pursuant to sections 381 and 44 for their subscription to the               
          AdaCom program (program);                                                   
               (2) whether petitioners are entitled to claim a trade or               
          business expense deduction under section 162 with respect to the            
          program; and                                                                
               (3) if petitioners are entitled to a credit and/or deduction           
          for their investment in the program, the proper valuation of the            

               1  Unless otherwise indicated, all section references are to           
          the Internal Revenue Code in effect for the years in issue, and             
          all Rule references are to the Tax Court Rules of Practice and              

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Last modified: May 25, 2011