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Visa credit cards. On their Chevron credit card, petitioners
incurred monthly finance charges every month during 2002. The
five Visa credit card statements show, along with interest and
finance charges, transactions at Kinko’s, Safeway, Whole Foods
Market, and Bally Total Fitness, among other places, indicating
that the interest related substantially to credit card charges
for personal purposes.
Section 262 expressly disallows deductions for personal,
living, or family expenses. Petitioners failed to substantiate
that any interest expense associated with the credit card charges
was other than a nondeductible personal expense. No portion of
the interest was shown to be related to the real estate activity.
The claimed interest, therefore, is not allowed as a deduction.
Office Expenses
Petitioners offered monthly credit card statements and
copies of two checks to substantiate the $1,689 for office
expenses. Absent further corroborating evidence to support these
expenses and their relationship to the real estate activity, the
Court sustains respondent’s disallowance of these expenses.8
8The $1,689 also included what appear to be utility expenses
attributed to two vendors or service providers listed as “PG&E”
and “Water”. Regardless of their classification, petitioners did
not establish that those expenses were related to the real estate
activity or were other than personal.
Petitioners also claimed as office expenses cellular phone
charges to T-Mobile. Cellular phones are classified as listed
property under sec. 280F(d)(4)(A)(v), and petitioners offered no
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