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H. Claimed Deductions for Legal and Professional Fees
In 1975 petitioner paid DuBois Jansson $2,907.34 for
services rendered with respect to acquiring railroad equipment
that would be sold to the Iranian State Railway. Petitioner
deducted this amount on his 1975 Federal income tax return. On
his tax returns and in his books and records for the years 1973
through 1977 petitioner took the position that the income from
only 40 percent of the products sold to Iranian State Railways
was taxable to him. Petitioner contends that the income from the
remaining 60 percent of the products sold constituted income of
Diesel Power. Because we have found that all of the income was
petitioner's, he is entitled to deduct professional fees of
$2,907.34 paid to DuBois Jansson for 1975.
During the years 1976, 1977, and 1978 petitioner deducted
legal fees paid to the law firm of George, Greek, King, McMahon &
McConnaughey in amounts that were at least $57,921.08,
$57,419.26, and $25,059.21, respectively. These fees were paid
for a variety of services, including acquisitions of real estate,
matters involving the Harris Corporation, handling the
arbitration of a dispute between Clark and Diesel Power, handling
a home purchase matter for petitioner's brother, Monty Zand,
landlord-tenant issues, research concerning joint ventures,
matters involving insurance and pension plans, tax matters,
preparations of a will and trust, and a number of conferences
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