- 12 - expenditure. We have already concluded that the payments do not constitute trade or business expenditures, and petitioner has offered nothing to show that his interest payments relate to either passive activity or investment expenditures. We therefore hold petitioner may not deduct his interest payments under section 163. Section 265 - Tax Exempt Income Respondent argues that section 265 also prevents petitioner from deducting the interest expenses here at issue. Because the Court concludes that petitioner's interest payments are not deductible under either section 162 or 163, we decline to examine the implications of section 265 on petitioner's scholarship repayment. For the foregoing reasons, we sustain respondent's determination that petitioner is liable for the deficiency relating to the deduction of his interest payments for 1991, 1992, and 1993. To reflect the foregoing, Decision will be entered under Rule 155.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12
Last modified: May 25, 2011