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business establishment if the requirements of section 280A(c)(1)
are met. Section 280A(c)(1), in turn, allows deductions
allocable to the portion of a dwelling unit that is exclusively
used on a regular basis as the principal place of business for
any trade or business of the taxpayer. As noted above,
respondent at trial conceded petitioners' entitlement to a home
office deduction for the portion of their dwelling used in
connection with their trade or business and rental properties.
With this concession, it follows that petitioners' computer is
excepted from the definition of "listed property" under section
280F(d)(4)(B); thus, the strict substantiation requirements of
section 274(d) are not applicable. Petitioners substantiated
their purchase of the equipment, and the Court is satisfied that
the computer was used for business and investment purposes.
Petitioners, therefore, are entitled to depreciation deductions
on their computer for the 2 years at issue.
The trade or business activity of petitioners previously
referred to was conducted by Mr. Zeidler under the trade name of
GLZ Financial Services. He provided consulting and estate
planning services and was also licensed to sell insurance.
Petitioners reported their income and expenses from this activity
on Schedule C, Profit or Loss From Business, of their returns.
In the notices of deficiency, respondent disallowed several of
the expenses claimed by petitioners for each of the years in
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