Bennett Geiger - Page 2

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          issues we must decide are:  (1) Whether petitioner qualifies for            
          a theft loss deduction pursuant to section 165(c) in excess of              
          $5,586; (2) if petitioner is entitled to the deduction, whether             
          it is properly claimed for taxable year 2000; and (3) whether               
          petitioner is liable for the accuracy-related penalty pursuant to           
          section 6662(a).                                                            
                                  FINDINGS OF FACT                                    
               Some of the facts and certain exhibits have been stipulated.           
          The parties’ stipulations of facts are incorporated herein by               
          reference and are found as facts.  Petitioner resided in                    
          Jacksonville, Florida at the time the petition was filed.                   
               Petitioner is the sole shareholder in Big Ben Tree Service,            
          Inc. (BBTS), an S corporation.  BBTS filed its Federal income tax           
          return for taxable year 2000 on June 25, 2001, on which it                  
          claimed a theft of property held more than 1 year and valued at             
               BBTS issued to petitioner a Schedule K-1, Shareholder’s                
          Share of Income, Credits, Deductions, etc., attached to its                 
          taxable year 2000 Federal income tax return, containing a loss              
          amount of $1,645,986 from previous years for inclusion on                   
          petitioner’s return.  BBTS also deducted a loss item of $155,227            
          for the current year from Form 4797, Sales of Business Property,            
          on its taxable year 2000 return.  In attachments to their 2000              
          tax returns, both BBTS and petitioner alleged theft losses of:              

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