- 12 -
Malinowski v. Commissioner, 71 T.C. 1120, 1125 (1979); Furnish v.
Commissioner, T.C. Memo. 2001-286; Joseph v. Commissioner, T.C.
Memo. 1997-447; Watson v. Commissioner, T.C. Memo. 1988-29.
Moreover, even though Congress imposed heightened substantiation
requirements for some business deductions by enacting section
274, the regulations under that section allow a taxpayer to
substantiate a deduction by reasonable reconstruction of his or
her expenditures when records are lost through no fault of the
taxpayer. Sec. 1.274-5T(c)(5), Temporary Income Tax Regs.,
supra.
Generally, we found Dr. Rinker’s testimony honest,
forthright, and credible. Although Dr. Rinker seemed somewhat
unfamiliar with financial matters, her testimony fundamentally
corresponded with the original documentation and reconstructions
that petitioners provided. She testified credibly as to the
existence and business purpose of many of the deductions claimed
on petitioners’ 1999 return with respect to her medical practice.
For some of those deductions, Dr. Rinker was also able to recall
the approximate amounts of her expenses, but for many of them,
Dr. Rinker lacked any independent recollection of the amounts of
the claimed deductions.
Where Dr. Rinker’s testimony provided a sufficient basis for
the Court to estimate the amounts of her expenditures, we have
done so, weighing against petitioners’ inexactitude where
Page: Previous 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 NextLast modified: May 25, 2011