Pedro Rodrguez Cruz and Mnica Santiago Del Valle, are married under the community property regime and file their income tax return as married filing jointly. Pedro's date of birth is January 1, 1950 and Monica's is February 1, 1955. The couple's address is Urb. Bella Vista, Calle Monte #1, San Juan, PR 00910. Both are citizens of the United States. United States of America, residents of Puerto Rico, have not generated income outside of Puerto Rico, and are not military.

During taxable year 2021, they carried out the following activities. Pedro Rodriguez, dba, Medical Equipment & Supplies Pedro, merchant (Salesperson-retail), owns a business on his own (sole proprietorship), Medical Equipment & Supplies dedicated to the sale and distribution of medical equipment. The business is located in San Juan. Pedro began operations on January 2, 2012 and works there about 40 hours a week. The result of its operations, under the accrual method and on a tax basis, during 2021 was as follows:

Sales $325,000 (not informed in 480s) cost of goods sold. 150,000 rent expense 24,000 Professional services 16,000 Others 10,000

The business meets all the requirements to claim all of its expenses for purposes of the regular tax and the alternate basic tax. Submitted the Agreed-Upon Procedures (AUP).