Theldon and Mary Parrett - Page 5




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          records, a taxpayer, under the law, was "allowed" deductions for            
          such expenses pursuant to a "formula".                                      
               The disallowed deductions consisted of the following:                  


                 1998        1999                                                     
          Charitable contributions             $ 7,159     $ 6,725                    
          Unreimbursed employee expenses                                              
          (before the sec. 67(a)                                                      
          limitation)                          14,472      15,701                     

               Petitioners acknowledged at trial that their actual                    
          charitable contributions were considerably less than the amounts            
          claimed on their returns.  Mrs. Parrett estimated that                      
          petitioners actually contributed to charity approximately 33                
          percent of the amount claimed on their 1998 return and                      
          approximately 24 percent of the amount claimed on their 1999                
          return.                                                                     
               The unreimbursed employee expenses shown above represented             
          the commuting expenses of petitioners to and from their residence           
          with respect to their respective places of employment.  Mr.                 
          Beltran advised petitioners that such expenses were deductible,             
          even though it appears that petitioners had never previously                
          claimed such expenses as deductions on their returns for prior              
          years.                                                                      
               With respect to the first issue regarding petitioners'                 
          entitlement to deductions for charitable contributions and                  





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