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a drug test for the driver who operated as an independent
contractor.
Discussion
Section 162(a) allows deductions for "ordinary and
necessary" expenses paid or incurred during the taxable year in
carrying on any trade or business. Deductions are a matter of
legislative grace, and taxpayers must prove that they are
entitled to the claimed deductions. See Rule 142(a); INDOPCO,
Inc. v. Commissioner, 503 U.S. 79, 84 (1992). Sufficient records
to establish deduction amounts must be maintained. See sec.
6001; Willits v. Commissioner, T.C. Memo. 1999-230. A taxpayer's
inability to produce records does not relieve the taxpayer of the
burden of proof. See Estate of Mason v. Commissioner, 64 T.C.
651, 657-658 (1975), affd. 566 F.2d 2 (6th Cir. 1977).
In the present case, petitioner has failed to produce
sufficient documentation to support the claimed deductions.
Petitioner introduced into evidence a number of so-called
Settlement Sheets (sheets). These sheets were produced by the
various companies for which petitioner's driver hauled freight.
The sheets contain various information on the trucking runs,
e.g., the location of the containers, the distances, pick-up
dates, etc. The sheets also note the costs of each run and in
some cases the amounts paid out by the company contracting for
the runs.
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