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testified that he and his wife never belonged to a country club
prior to the time he joined Gull Lake Country Club and have not
belonged to one since. He used the country club solely to
entertain business customers, and never on social occasions; his
wife and family never used the facilities of the club. Mr. Martin
further testified:
frankly, Mrs. Martin did not want to join a country club.
We're not country club type people and she was very much
against it, always has been against it, still is against
it * * * But after I received some pressure, I said,
hey, it's going to be one way or the other, so I'll join
and we'll try it. And I finally joined it.
We found Mr. Martin's testimony in this regard to be credible.
Respondent argues that a one-time club membership is not
currently deductible, but is a capital expenditure. Mercantile
Natl. Bank v. Commissioner, 30 T.C. 84 (1958), affd. 276 F.2d 58
(5th Cir. 1960). As a general proposition, we agree that a one-
time club membership fee is a capital expenditure because the
benefits of the payment will last beyond a 1-year period. However,
here, Mr. Martin both joined and terminated his membership in the
country club in 1989.
Because we find that Mr. Martin's expenses and fees in the
country club were business expenses, and because Mr. Martin both
joined and terminated his country club membership in the same year,
we hold that petitioners are entitled to a deduction of $5,020 on
Schedule A of their 1989 tax return.
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