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only a small portion of that corporation’s 1999
ordinary loss and none of its 2000 ordinary loss.
Scott W. Dolson and Robert C. Webb, for petitioners.
Denise A. Diloreto and Mark D. Eblen, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
HALPERN, Judge: These consolidated cases involve the
following determinations by respondent of deficiencies in
petitioners’ Federal income tax:
Year Al A. Ruckriegel Sid Paul Ruckriegel
1999 $110,544 $107,064
2000 122,272 124,130
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
Procedure. All dollar amounts have been rounded to the nearest
dollar.
The issue for decision is whether petitioners had sufficient
bases in their S corporation,1 Sidal Inc. (Sidal), during 1999
and 2000 (the audit years), under section 1366(d)(1)(B), to
1 The term “S corporation” is defined in sec. 1361(a)(1).
In general, an S corporation has no Federal income tax liability,
and its items of income, deduction, credit, and such are passed
through to (i.e., taken into account by) its shareholders. See
secs. 1363(a), 1366(a).
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