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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.
After a concession by respondent,1 the issues for decision
are: (1) Whether petitioners substantiated deductions, losses,
and/or cost of goods sold in excess of amounts respondent allowed
or conceded for 2002 and 2003, (2) whether petitioners are liable
for self-employment tax in 2002 and 2003, (3) whether petitioners
are liable for the section 6651(a)(1) addition to tax for 2003,
and (4) whether petitioners are liable for the section 6662(a)
penalty for 2002 and 2003.
FINDINGS OF FACT
None of the facts have been stipulated. Confronted with
petitioners’ refusal to work toward a stipulation of facts,
respondent filed, among other things, requests for admission
pursuant to Rule 90. After the Court granted a motion by
petitioners to extend the time for their reply to respondent’s
requests for admission, petitioners did not file a response
within the time permitted to respondent’s requests for admission,
including the extension of time granted by the Court.
1 Respondent concedes that petitioners substantiated
$3,122.52 in labor expenses for 2003 (attributable to services
performed by William Ray).
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Last modified: November 10, 2007