4
Expense Amount Claimed
Car and truck $329
Employee benefit program 1,413
Insurance 1,246
Rental of business property 8,890
Travel 515
Utilities 1,899
Bank service charges 337
Miscellaneous 1,241
Total $15,870
On a revised Schedule C dated October 17, 1992, petitioner
increased his deductions for travel expenses claimed to
$5,931.30, and claimed additional expenses for entertainment
($202.94) and meals ($1,014.70). Petitioner reported no income
in 1991 other than the wages and tips he earned while driving a
taxi-cab for Whittlesea Cabs.
Respondent determined that petitioner's business activities
were not engaged in for profit, and therefore disallowed all of
the deductions claimed attributable thereto.2 Alternatively,
respondent determined that petitioner failed to substantiate the
deductions and to prove that the expenditures were ordinary and
necessary to his businesses. The determinations of respondent
are presumed correct, and petitioner bears the burden of proving
otherwise. Rule 142(a).
All taxpayers are required to keep sufficient records to
enable respondent to determine their correct tax liability. Sec.
2 Although not addressed in the notice of deficiency, respondent
also disputes the additional expenses claimed on petitioner's
revised Schedule C.
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Last modified: May 25, 2011