Remove casings from sausage.
Cook sausage in a skillet until browned.
Stir to crumble, drain well.
Add tomatoes, tomato paste, onion, garlic, Italian seasoning, sugar, and red pepper, and bring to a boil.
Cover, reduce heat, and simmer 30 minutes.
Stir in green pepper and mushrooms.
Cover, and simmer 10 minutes.
Serve over hot cooked rice.