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expended for meals and lodging* * *) while away from home in the
pursuit of a trade or business". Section 274(d) provides further
that, to substantiate such expenses, the taxpayer must maintain
adequate records that include maintaining an "account book,
diary, log, statement of expense, trip sheet, or similar record
* * * and documentary evidence * * * which, in combination, are
sufficient to establish each element of an expenditure". Sec.
1.274-5(c)(2)(i), Income Tax Regs.6 The substantiation
requirements of section 274(d) apply to automobile expenses by
virtue of section 280F(d)(4) and to expenses connected with other
classes of property referred to as "listed property" and defined
in section 280F(d)(4). Section 280F(d)(4)(A)(i) and (ii)
includes any passenger automobile or any other property used as a
means of transportation. Petitioners did not maintain the
records required by section 274(d) to substantiate their meals
and automobile expenses. Respondent, therefore, is sustained on
this issue.
As noted earlier, petitioners owned two residential rental
properties as to which they reported their income and expenses on
Schedule E of their returns. One of the properties was a single
family home located at Sister Bay, Wisconsin, a popular resort
and vacation area located 90 miles north of Milwaukee, Wisconsin.
6
Under sec. 274(d)(1), the substantiation requirements for
traveling expenses are applicable to expenses under sec. 162, as
well as expenses under sec. 212.
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