Les B. Martin and Millie A. Martin - Page 8

          The increase in the amount of income for 1989 ($39,062) between             
          that reported on the amended return and that reported on the                
          original return is the gain (short-term) from the sale of Woodhead          
          stock which had originally been reported on Schedule D of                   
          petitioners' 1989 tax return.  At trial and in their posttrial              
          brief, petitioners state they are willing to concede 30 percent of          
          the expenses claimed on their amended returns, so that now they             
          claim expenses of $15,241 for 1989 and $9,308 for 1990.  The                
          majority of these expenses represents home office expenses                  
          (including the purchase of furniture) and automobile expenses.              
               Respondent disallowed this deduction on the ground that the            
          expenditures were not ordinary and necessary expenditures.                  
          Further, as to those deductions claimed in connection with the use          
          of petitioners' residence as a home office, the deductions were             
          disallowed, in part, on the basis that some of the claimed expenses         
          were personal, and on the basis that petitioners failed to prove            
          their home office was used exclusively for business purposes.               
          Miscellaneous Itemized Deductions                                           
               On Schedule A of their 1990 return, petitioners claimed $7,174         
          in miscellaneous itemized expenses.  Apparently the majority of the         
          expenses with regard to this deduction consist of travel and meal           
          expenses in connection with Mr. Martin seeking new employment.  On          
          petitioners' amended 1990 tax return, the amount of the deduction           
          was increased to $7,176; no explanation was given for the $2                
          difference.  Respondent disallowed the deduction for lack of                

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011