- 13 -
and necessary business expenses (nor did Roy, Inc. substantiate a
business purpose for such expenses).
Even if, as the individual petitioners contend, some business
purpose existed for Mohan Roy's use of the Rolls Royce (such as
driving to hospitals to visit patients or perform surgeries), we
cannot find any evidence in the record to support an estimate of
the amount of business use as opposed to personal use. Cf. Henry
Schwartz Corp. v. Commissioner, 60 T.C. 728, 744 (1973). Moreover,
Mohan Roy received a personal and economic benefit from driving a
luxury automobile for commuting purposes. Cf. Erickson v.
Commissioner, 598 F.2d 525, 530-531 (9th Cir. 1979), affg. in part
and revg. in part T.C. Memo. 1976-147. Consequently, we hold that
the individual petitioners received constructive dividends from
Roy, Inc. as a result of Mohan Roy's use of the Rolls Royce
automobile. See Connelly v. Commissioner, T.C. Memo. 1994-436;
Royce C. McDougal, M.D., Inc. v. Commissioner, T.C. Memo. 1985-64;
William N. Smith, M.D., P.C. v. Commissioner, T.C. Memo. 1983-426;
Tyson v. Commissioner, T.C. Memo. 1979-122.
We must next decide the amount of constructive dividends
received by the individual petitioners. Mohan Roy testified that
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