- 11 -
percent of petitioners' adjusted gross income, and, therefore,
that petitioners' miscellaneous itemized deduction was zero.
At trial, Mrs. Brown testified that Mr. Brown paid all
expenses related to his job as pastor for a small church. Mrs.
Brown testified that Mr. Brown paid for all expenses during his
visits and trips to hospitals and wakes, including mileage,
travel, and entertainment. Additionally, Mrs. Brown testified
that, in his ministry, Mr. Brown purchased books, flowers, and
gifts and incurred office expenses. We are satisfied by the
testimony of Mrs. Brown in the instant case that petitioners
incurred some amount of expenses in carrying out Mr. Brown's
ministry. Accordingly, we approximate that petitioners incurred
allowable expenses (i.e., expenses other than travel expenses,
which are disallowed pursuant to section 274(d) on the grounds of
lack of adequate records or sufficient evidence) in the amount of
$6,000 pursuant to Mr. Brown's ministry. Accordingly, we hold
that petitioners are entitled to deduct $6,721 in "Job Expenses
and Most Other Miscellaneous Deductions" (line 21 deduction),
subject to the 2-percent limitation based on petitioners'
adjusted gross income resulting from the Rule 155 computations
that we order below.
Finally, on the basis of the increase in petitioners' gross
income resulting from all of the adjustments in the notice of
deficiency, respondent determined that petitioners' adjusted
gross income exceeded $100,000 and, therefore, reduced
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