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by sufficient evidence, corroborating the taxpayer's own
statement: (1) The amount of the expense; (2) the time and place
of the travel or entertainment; (3) the business purpose of the
expense; and (4) the business relationship of the taxpayer to the
persons entertained. These four elements must be established for
each separate expenditure. Sec. 1.274-5(c)(1), Income Tax Regs.;
Dowell v. United States, 522 F.2d 708, 714 (5th Cir. 1975).
A taxpayer satisfies the substantiation requirements of
section 274(d) by meeting the adequate records test or through
substantiation by other sufficient evidence. Sec. 1.274-5(c)(1),
Income Tax Regs. Proof by "adequate records" requires the
taxpayer to maintain a contemporaneous account book, diary,
statement of expense, or similar record and documentary evidence
which, in combination, "are sufficient to establish each element
of an expenditure". Sec. 1.274-5(c)(2), Income Tax Regs. In
addition to an account book or diary, substantiation by adequate
records requires additional documentary evidence for expenditures
of $25 or more, except for transportation charges, if
documentation for such charges is not readily available. Sec.
1.274-5(c)(2)(iii)(b), Income Tax Regs. Acceptable documentary
evidence includes receipts, paid bills, or other similar evidence
which establish the amount, date, place, and essential character
of the expenditure. Sec. 1.274-5(c)(2)(iii), Income Tax Regs.
Failure to produce adequate documentary evidence results in
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