Thai V. Pham and Khuy T. Bui - Page 12

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          incurred a deductible expense, but the taxpayer is unable to                
          adequately substantiate the amount of the deduction to which he             
          or she is otherwise entitled, the Court may estimate the amount             
          of such expense and allow the deduction to that extent.  Cohan v.           
          Commissioner, supra.  In order for us to estimate the amount of             
          an expense, however, we must have some basis upon which an                  
          estimate may be made.  Vanicek v. Commissioner, 85 T.C. 731, 743            
          (1985).  Without such basis, any allowance would amount to                  
          unguided largesse.  Williams v. United States, 245 F.2d 559, 560            
          (5th Cir. 1957).                                                            
               Due to the total absence of documentation and inconsistent             
          testimony, we are without a reasonable basis to estimate the                
          amount of compensation payments petitioners made to their sons.             
          Thus, we decline to apply the Cohan rule.  Consequently,                    
          petitioners have failed to satisfy their burden of establishing             
          their right to this deduction.  Accordingly, respondent's                   
          determination regarding this issue is sustained.                            
          Issue 2.  Schedule C Equipment Rental Expense Deduction                     
               Petitioners contend that, pursuant to section 162(a)(3),               
          they are entitled to deduct $7,200 as a business expense on their           
          income tax return for taxable year 1988.  Petitioners attribute             
          this expense to lease payments paid for the use of six sewing               
          machines, all of which were used in the ordinary course of their            
          sewing business.  Respondent argues that petitioners' inability             
          to substantiate the rental expense precludes allowance of the               

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