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Petitioner testified that the $15,300 claimed as a deduction
for printing expenses was based upon the following costs of
producing the brochures and folios for the real estate brokers:
Petitioners’ Creative Production Total
Exhibit Fees Costs Cost
5 $1,500 $4,184.77 $5,684.77
6 500 2,201.07 2,701.07
7 500 3,427.10 3,927.10
8 500 3,427.10 3,927.10
9 500 2,201.07 2,701.07
Exhibit totals 3,500 15,441.11 18,941.11
Examples of the brochures and folios, with an attached statement
of the production cost of each, were introduced into evidence.
Attached to Exhibit 5 was an invoice to the client for
photography and printing costs reciting that a partial payment
had already been received.
Petitioner has not persuaded us that he included in his
gross income any amounts corresponding to the $15,300 or more he
allegedly paid to printers and photographers. He claimed to have
the evidence but failed to provide it to the Court. We are
satisfied that the payments were made directly by the clients to
the printers or that, if petitioner acted as a conduit for the
payments, he did not include them in gross income. In either
case, he is not entitled to a deduction for them. It defies
credibility that petitioner would enter arrangements that would
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