-13-
nonetheless, pursuant to section 183(b), deduct the related
expenses to the extent of the gross income from the activity.
The final issue to be resolved before such deductions can be
allowed is whether petitioner has substantiated the expenses
claimed.
All taxpayers are required to keep sufficient records to
enable the Commissioner to determine their correct tax liability.
Sec. 6001; Meneguzzo v. Commissioner, 43 T.C. 824, 831-832
(1965). Moreover, deductions are a matter of legislative grace,
and petitioner bears the burden of proving that he is entitled to
any deduction claimed. Rule 142(a); New Colonial Ice Co. v.
Helvering, 292 U.S. 435, 440 (1934); Welch v. Helvering, 290 U.S.
at 115. This includes the burden of substantiation. Hradesky v.
Commissioner, 65 T.C. 87, 90 (1975), affd. per curiam 540 F.2d
821 (5th Cir. 1976).
Petitioner provided no documentary evidence substantiating
the deductions claimed with respect to his artist activity.
Petitioner testified concerning his expenses and elicited
testimony from another witness concerning some of his expenses.
We have held that if the record provides sufficient evidence that
the taxpayer has incurred a deductible expense, but the taxpayer
is unable to adequately substantiate the amount of the deduction
to which he is otherwise entitled, the Court may estimate the
amount of the expense and allow the deduction to that extent.
Cohan v. Commissioner, 39 F.2d 540, 543-544 (2d Cir. 1930). In
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