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that the vast majority of them were either for nondeductible
personal items or for transportation and entertainment and did
not meet the more stringent requirements of section 274(d).
Petitioner, on the other hand, contends that most of the
expenditures represented by these documents were in connection
with his real estate business activity.
The credit card records, which are admittedly incomplete,
totaled $11,179.74 for the 2-year period (1992-93). Of the
$11,179.74: $9,234.43 was for 1992; $1,679.02 was for 1993; and
$266.29 was not differentiated as to the year. The Court found
respondent’s review of these items to be hypercritical. Other
than items that are clearly for travel and entertainment,
respondent did not give petitioner the benefit of the doubt. For
example, on a charge for the changing of a lock, respondent in
denying a deduction commented: “Why did lock(s) need to be
changed”? In situations where the payment of the credit card by
one of petitioner’s related corporate entities had been
determined to be income, respondent in denying a deduction,
commented: “Bus purpose--already acctd above??”3 On several
purchases of hardware, respondent in denying a deduction
commented: “Bus purpose--vague”.
3 We assume that respondent concluded that these
expenditures that were used to reconstruct petitioner’s income
were personal in nature and not deductible as a business expense.
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