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506 U.S. 168, 175 (1993). Two primary considerations in deciding
whether a taxpayer may deduct costs of a home office are: (1)
The relative importance of the activities performed at each
business location, and (2) the time spent at each place. Id.
Other than testifying that she used a room in her home
exclusively as her main business office, petitioner presented no
evidence to establish either the nature of or the relative
importance of the activity performed at this location. Further,
petitioner did not establish how much time she spent in her
office. Therefore, we conclude that petitioner is not entitled
to a home office deduction.
11. Telephone
Petitioner also submitted copies of her telephone bills from
1994. Petitioner did not maintain a separate telephone line for
her business. We may estimate the deductible amount of
petitioner's telephone expenses. Laurano v. Commissioner, 69
T.C. 723, 727 (1978). Section 262(b) provides that the basic
local telephone service for the first telephone line to a
taxpayer's residence is a nondeductible, personal expense.
Petitioner testified that most of her long distance calls
were business related. Petitioner presented copies of her
telephone bills from 1994. In calculating her business expenses,
petitioner excluded amounts related to the basic local service.
On the basis of our best judgment, we find that petitioner is
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