Steven and Jennie Jacobs - Page 7

                                                 - 7 -                                                    

            legitimate and deductible.  The taxpayer, however, did not                                    
            produce any of the receipts substantiating such expenses.  The                                
            Court of Appeals directed the Board of Tax Appeals to estimate                                
            such expenses "bearing heavily if it chooses upon the taxpayer                                
            whose inexactitude is of his own making".  Id. at 544.                                        
                  Section 274(d) overrides the Cohan doctrine with respect to                             
            expenses of travel away from home (including meals and lodging)                               
            and entertainment.  Sanford v. Commissioner, 50 T.C. 823, 827                                 
            (1968), affd. per curiam 412 F.2d 201 (2d Cir. 1969); sec. 1.274-                             
            5T(a), Temporary Income Tax Regs., 50 Fed. Reg. 46014 (Nov. 6,                                
            1985).  Under section 274(d), a taxpayer must substantiate the                                
            amount, time, place, and business purpose of the expenditures and                             
            furnish adequate records or sufficient evidence corroborating his                             
            own statement.  Sec. 1.274-5T(c)(1), Temporary Income Tax Regs.,                              
            50 Fed. Reg. 46016 (Nov. 6, 1985).  Adequate records are defined                              
            as an account book, diary, log, statement of expense, trip                                    
            sheets, or similar records, plus "documentary evidence".  Sec.                                
            1.274-5T(c)(2), Temporary Income Tax Regs., 50 Fed. Reg. 46017                                
            (Nov. 6, 1985).  Examples of documentary evidence include                                     
            receipts, paid bills, or similar evidence to support an                                       
            expenditure, except that, with respect to any expenditure of less                             
            than $25 incurred prior to October 1, 1995, or transportation                                 
            charges "documentary evidence will not be required if not readily                             
            available, provided, however, that the Commissioner in his                                    





Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  Next

Last modified: May 25, 2011