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investment management companies, accountants, and attorneys. The
trust paid or incurred the expenses related to such services.
Petitioner's proportionate shares of these expenses amounted to
$19,274 for 1993 and $28,984 for 1994.
In computing her taxable income for each year in issue,
petitioner elected to itemize her deductions. On Schedules A
included with her 1993 and 1994 Federal income tax returns,
petitioner claimed her proportionate shares of the trust expenses
as "Other Miscellaneous Deductions" as detailed below:
1993 1994
Misc. expenses $19 $9
Rent expense 106 374
Investment fees 10,335 15,323
Travel expense 36 1,066
Investment custodial fees 2,683 3,494
Professional fees 6,080 1,701
Telephone expense --- 64
Atty. and acct. fees --- 6,836
Other depreciation 15 117
Total 19,274 28,984
In the notice of deficiency, respondent reduced the totals
of the above deductions by 2 percent of petitioner's adjusted
gross income for the appropriate year, made other computational
adjustments, and determined the deficiencies here in dispute
accordingly.
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