- 14 - ETCO did not provide sufficient substantiation to refute respondent's determination of the automobile expenses as required under section 274(d)(4). Although ETCO offered a mileage log, which showed destinations, dates, and miles driven, ETCO did not offer records to substantiate which of the two automobiles had been driven on each date, the total odometer mileage for each automobile, return dates, or the business purpose of each trip they took in each of the automobiles. Added to the lack of substantiation to determine accurately the business-use percentage are the facts that the Lincoln was not designated as a business-use automobile on the lease agreement and was designated as a personal-use vehicle on the insurance contract. We find that ETCO has not carried its burden to show that deductions in excess of that determined in respondent's notice of deficiency should be allowed.4 Respondent further argues that the amounts of the automobile lease payments and the automobile insurance payments, paid by ETCO and attributed to Mr. and Mrs. Thorpe's personal use, were constructive dividends from ETCO to Mr. and Mrs. Thorpe. Generally, section 61 provides that gross income includes income from whatever source derived, including fringe benefits, gross 4In the notice of deficiency sent to ETCO, respondent also determined that ETCO's income must be increased by $713 in fiscal year 1990 due to the auto lease inclusion requirements. See sec. 280F. Petitioners do not contest this amount, either at trial or on their briefs. Therefore, respondent's determination with respect to this amount is sustained.Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Next
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