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carrying on a trade or business. However, petitioners are not
entitled to deduct expenses under section 162(a) for which they
have been or could have been reimbursed. Orvis v. Commissioner,
788 F.2d 1406 (9th Cir. 1986) (deduction not allowable to the
extent that the employee is entitled to reimbursement from the
employer), affg. T.C. Memo. 1984-533; Lucas v. Commissioner, 79
T.C. 1, 7 (1982) (same); Kennelly v. Commissioner, 56 T.C. 936,
943 (1971) (same), affd. without published opinion 456 F.2d 1335
(2d Cir. 1972).
In order to deduct unreimbursed vehicle expenses,
petitioners must also substantiate the expenses in accordance
with the provisions of section 274. Section 274(d)(4) provides
that no deduction is allowable with respect to listed property,
as defined in section 280F(d)(4), unless the deductions are
substantiated in accordance with the strict substantiation
requirements of section 274(d) and the regulations promulgated
thereunder. Included in the definition of listed property in
section 280F(d)(4) is any passenger automobile. Sec.
280F(d)(4)(A)(i).
To substantiate a deduction attributable to listed property,
a taxpayer must maintain adequate records or present
corroborative evidence to show: (1) The amount of the expense,
(2) the time and place of use of the listed property, and (3) the
business purpose for the use. Sec. 1.274-5T(b)(6), Temporary
Income Tax Regs., 50 Fed. Reg. 46016 (Nov. 6, 1985).
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