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taxes paid of $1,471, employee business expenses of $7,520, and
gifts to charities of $100.1 Petitioner also received
reimbursement of employee business expenses of $6,099 for each of
the years 2001 and 2002. The $6,099 that petitioner received in
each of the years in issue was not dependent on the actual
expenses incurred or miles driven. Petitioner was not required
to report the number of miles driven to his employer. The
payment was described by petitioner as an “expense allowance”.
Petitioner did not report the $6,099 as income on his respective
returns.
In a notice of deficiency respondent disallowed all the
itemized deductions claimed on the 2001 and 2002 returns. Before
trial the parties agreed that petitioner is entitled to
deductions for gifts to charities as claimed on the 2001 and 2002
returns. The parties further agreed that petitioner is entitled
to the claimed deduction for taxes for 2002.2 Respondent did not
adjust petitioner’s income to include the $6,099 in reimbursed
1 The 2002 Federal income tax return was not made part of
the record; however, other evidence, including copies of Forms W-
2, Wage and Tax Statement, reflect that petitioner received
salary in the amount of $61,868.83.
2 The notice of deficiency allowed a standard deduction in
lieu of the claimed itemized deductions for 2001 and 2002. It is
not clear whether the allowance of the itemized deductions for
gifts to charity and for taxes will result in any tax benefit to
petitioner. The Court will enter a decision under Rule 155 and
permit the parties to compute the tax liability that is most
advantageous to petitioner.
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Last modified: May 25, 2011