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office. Sec. 280A(c)(1). Petitioner maintained his home office
in the living and dining room area of the Estrella residence and
of the condominium. We are not convinced that petitioner used
these areas solely for his home office. We conclude that all
expenses relating to petitioner's home office, including rent,
utilities, and office expenses, were correctly disallowed by
respondent.
Turning to the other claimed expenses that remain in dispute
on the grounds that petitioner has not adequately substantiated
the business nature and amount of the expenses, it is well
established that taxpayers generally bear the burden of proof
regarding claimed business deductions. Rule 142(a); Welch v.
Helvering, 290 U.S. 111 (1933).
Under section 162, deductions are allowed for all ordinary
and necessary expenses paid or incurred during a tax year in
carrying on a trade or business. Cash basis taxpayers must
establish: (1) That the expenses were paid; (2) that they were
paid during the year in issue; (3) that they were paid in
furtherance of a trade or business; and (4) that they were
ordinary and necessary expenses of the trade or business. Sec.
1.162-1, Income Tax Regs.
Taxpayers are required to maintain adequate records to
substantiate business expenses and to enable respondent to
determine their correct tax liability. Sec. 6001. Where a
taxpayer does not have adequate records, the burden of proof
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