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employee business expenses, such as workmen's compensation
insurance payments, and gasoline and van rental expenses. These
deductions are, of course, allowable only to the extent they
exceed 2 percent of petitioner's adjusted gross income. Sec.
67(a). Respondent asserts, however, that petitioner is also
attempting to characterize loan and cash advance repayments as
allowable employee business expenses.
Deductions are strictly a matter of legislative grace, and
petitioner bears the burden of proving his entitlement to any
deductions claimed. Rule 142(a); INDOPCO, Inc. v. Commissioner,
503 U.S. 79, 84 (1992); New Colonial Ice Co. v. Helvering, 292
U.S. 435, 440 (1934).
Petitioner has presented no evidence that amounts listed as
"loan payments" are deductible as employee business expenses.
Respondent's determinations as to petitioner's employee business
expense deductions are therefore sustained.
II. Section 6651 Addition to Tax
Section 6651(a)(1) imposes a 5-percent addition to tax each
month for failure to file a tax return. The addition is not to
exceed 25 percent in the aggregate. The statute provides a
reasonable cause exception where the taxpayer can prove the
failure to file was not due to willful neglect. Sec. 6651(a)(1).
Petitioner testified that he did not file a tax return for
1989 because his Form 1099 from Carolina Acoustical designated
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