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or business. Sec. 162(a). Whether expenditures are “ordinary”
and “necessary” generally are questions of fact. Commissioner v.
Heininger, 320 U.S. 467 (1943).
We agree with respondent that petitioners may not deduct any
expenses on their Schedules C, other than the ones she has
allowed. Petitioners have not persuaded us that they incurred
any other expenses (including the disallowed amounts reported on
their tax returns), or, even if they had, that these other
expenses were ordinary and necessary under section 162(a).
See also sec. 6001 (petitioners must keep sufficient records to
substantiate any deduction otherwise allowable by the Code).
With respect to the 1986 and 1988 Peterbilts, respondent
determined that Mr. Tillman purchased these trucks. Petitioners
claim that Mr. Tillman leased them. To support their claim,
petitioners rely primarily on the fact that some of the documents
surrounding the acquisition use the terms “lease” or “rent”. We
are not persuaded. Whether a transaction is a sale or a lease
does not rest on the name given to the transaction by the parties
thereto, either in or out of the surrounding documents. What is
critical is the intent of the parties. We must ask ourselves:
“What did the parties to the transaction believe the legal effect
of the transaction to be?” M & W Gear Co. v. Commissioner,
446 F.2d 841, 844 (7th Cir. 1971), affg. in part, revg. in part,
and remanding 54 T.C. 385 (1970). With this in mind, we are
unpersuaded that Mr. Tillman’s acquisitions of the Peterbilts
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