- 9 -
Midkiff v. Commissioner, 96 T.C. 724, 734 (1991), affd. sub nom.
Noguchi v. Commissioner, 992 F.2d 226 (9th Cir. 1993); Van Heemst
v. Commissioner, T.C. Memo. 1996-305.
In its reply brief, petitioner objected to the relevancy of
the exhibits. Petitioner contends that the exhibits are
irrelevant because respondent conceded to compensation for
Kleindienst in an amount greater than the average surveyed
compensation from both exhibits. Petitioner did not reserve
these relevancy objections in the stipulation of facts as
required by Rule 91. Foster v. Commissioner, 80 T.C. 34, 135
(1983), affd. in part and vacated in part 756 F.2d 1430 (9th Cir.
1985). In addition, petitioner's previous hearsay objections do
not reserve the relevancy objections to the stipulated exhibits
because objections must be specific. United States v. Ruffin,
575 F.2d 346, 355 (2d Cir. 1978). As the relevancy objections
raised by petitioner in its reply brief are untimely, we decline
to consider them. Pan Am. Acceptance Corp. v. Commissioner, T.C.
Memo. 1989-440.4
Section 162(a)(1) provides for a deduction for ordinary and
necessary business expenses including "a reasonable allowance for
4 Despite our holding that petitioner abandoned its
objections, we note that we did not rely on the exhibits. The
exhibits did not provide any information specifically about owner
or executive compensation in the escrow industry. In addition,
the exhibits did not identify whether the owners and executives
surveyed performed functions similar to those Kleindienst
performed. Thus, the exhibits provide little, if any, guidance
as to the value of Kleindienst's services.
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