- 10 - Finally, we have no evidence of petitioners' cost basis in the Ocean City property, and except for Mr. Kerrigan's self-serving testimony at trial, there is no evidence that Mrs. Kerrigan used the Ocean City condominium as an office. We therefore sustain respondent's determination. Freight Expenses Mrs. Kerrigan claimed a Schedule C deduction for freight expenses in the amount of $122. Respondent allowed $83. Since petitioners have not presented any evidence to substantiate this deduction, we sustain respondent's determination. Repair Expenses Respondent disallowed Mr. Kerrigan's $3,610.55 Schedule C deduction for repairs in its entirety. Petitioners offered nothing to substantiate most of this amount, nor do they explain how it was computed. Petitioners argue on brief that they have presented sufficient documentary evidence to substantiate a deduction in the amount of $329. They offered a handwritten log prepared by Mr. Kerrigan as a record of his business, travel, and entertainment expenses for 1985. However, they produced no invoices or canceled checks. Under these circumstances, we hold that Mr. Kerrigan has not adequately substantiated the business purpose of this Schedule C deduction. See sec. 1.162-1(a), Income Tax Regs.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
Last modified: May 25, 2011