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308 U.S. 488, 495 (1940) (citing Welch v. Helvering, supra at
114). ETCO bears the burden of proving that the claimed expenses
are deductible. Welch v. Helvering, supra at 115.
Mrs. Thorpe was an officer and an employee of ETCO. Mrs.
Thorpe attended various trade shows and conventions at which she
occupied the display booth, talked to people about ETCO's
product, met new or prospective clients, learned more about the
market, and solicited new business. ETCO procured most of its
business through direct solicitation of housing authorities in
various states where trade shows and conventions attracted
prospective clients. Respondent does not question the expenses
incurred by Mr. Thorpe who, like Mrs. Thorpe, was an officer and
employee of ETCO. Under these facts and circumstances, we find
that the travel and entertainment expenses incurred by Mrs.
Thorpe were ordinary and necessary business expenses of ETCO.
See Duncan v. Bookwalter, 216 F. Supp. 301, 305 (W.D. Mo. 1963).
Respondent argues that $1,514, $786, and $1,095 of the total
travel and entertainment expenses of $74,395, $81,237, and
$75,749 deducted by ETCO for the fiscal years ending June 30,
1990, 1991, and 1992, respectively, are not allowed because they
do not meet the substantiation requirements under section 274(d).
Under section 274(d)(4), the taxpayer must substantiate: (1) The
amount of the claimed expense; (2) the time and place the expense
was incurred; and (3) the business purpose of the expense. At
trial, respondent attempted to elicit testimony that would show a
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