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With respect to travel expenses incurred in his wear lining
business, petitioner's recordkeeping consisted of a mileage log
and a diary of appointments containing information regarding
where he went, with whom he spoke, and the subject matter. With
respect to lodging, petitioner did not have receipts to document
his expenses. Instead, he claimed lodging expenses as a
deduction for travel on his Schedule C by using a per diem
estimate that he found in an Internal Revenue Service
publication.
In addition to the expenses incurred in his wear lining
business, petitioner claimed Schedule C deductions for expenses
incurred in connection with certain real property acquisitions in
Florida. Sometime in 1990, petitioner acquired three properties
in Florida and had a house built on one of them with the
intention of leaving the wear lining business and beginning a
homebuilding business. The remaining two lots were undeveloped
when purchased by petitioner. During the years in issue,
petitioner had the lots cleared and filled to meet elevations
required by applicable flood laws and arranged for water service
to one of them. At some point in 1991, petitioner returned to
the wear lining business and tried to rent the house in Florida.
He obtained insurance coverage for the house based on its
intended use as a rental property. Petitioner was not successful
in finding a tenant in 1991 and eventually moved into the house
himself. On Schedule C of his 1990 return, petitioner deducted
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