- 13 - petitioners reported gross income of $38,220 and total expenses of $38,220. On the 1996 return, petitioners claimed multiple deductions for some of the same expenses. B. Beacon’s Tax Returns On or about August 12, 1994, Beacon submitted an “Estimated” Form 1120S, U.S. Income Tax Return for an S Corporation, for the taxable year 1993 (Beacon’s 1993 “Estimated” return) along with petitioners’ 1993 “Estimated” return. Beacon’s 1993 “Estimated” return reflected that Beacon was on the cash receipts and disbursements method of accounting (cash basis) for Federal income tax purposes.6 On or about March 4, 1997, Beacon filed with the IRS a second Form 1120S for the taxable year 1993 (Beacon’s 1993 return). Beacon’s 1993 return reported total income and total deductions of $13,691 and $24,248, respectively, for a loss of $10,557. Beacon’s total deductions included travel expenses of $13,717. Along with petitioners’ 1994 “Estimated” return, Beacon submitted for the taxable year 1994 a Form 1120S with “Estimated” written on the top of the first page (Beacon’s 1994 “Estimated” return). Beacon’s 1994 “Estimated” return reported total income and total deductions of $5,000 and $2,710, respectively. 6 At all relevant times during the years in issue, Beacon used the cash basis method of accounting for Federal income tax purposes.Page: Previous 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 NextLast modified: November 10, 2007