Charles H. Little III - Page 3

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               Respondent determined a deficiency of $34,496 in                       
          petitioner’s Federal income tax for the year 2002 and the                   
          additions to tax under sections 6651(a)(1) and 6654(a) in the               
          amounts of $10,003 and $1,152.75, respectively.                             
               Prior to trial, the parties agreed to a deficiency in the              
          amount of $12,642.2  The remaining issues for decision are                  
          whether petitioner is liable for the additions to tax under                 
          sections 6651(a)(1) and 6654(a).                                            
               Some of the facts were stipulated.  Those facts, with the              
          exhibits annexed thereto, are so found and made part hereof.                
          Petitioner’s legal residence at the time the petition was filed             
          was Mountlake Terrace, Washington.                                          
               Petitioner is a real estate agent who specialized in what he           
          described as “manufactured home parks and RV parks”.  More                  
          specifically, this is a phase or aspect of commercial real estate           
          in which the agent specializes in real estate transactions                  
          representing either buyers or sellers of parks or tracts of land            
          that are adapted as a location for manufactured homes and/or                
          recreational vehicles (RVs).  The customary practice is that the            
          entire park is owned by a landlord and lots or spaces in the park           
          are designated and leased for manufactured homes or RVs.  Each              
          lot is provided with the necessary utilities.  The individual               

               2The settlement is based upon petitioner’s concession that             
          he earned $103,827 in nonemployee compensation during the year              
          and $104 in taxable interest income.                                        

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