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1173 (D.C. Cir. 1990), and Brown v. Commissioner, T.C. Memo.
1989-89, affd. without published opinion 916 F.2d 710 (4th Cir.
1990). These cases are distinguishable. Unlike the taxpayers in
Matthews, petitioners have taken a position that is untenable and
have failed to establish that they made full disclosure of their
position to respondent. Unlike Brown, this is not a case where
respondent failed to act over a period of years when fully
informed of the facts.
We sustain respondent’s determination on this issue.
Crestmark’s Claimed Business Deductions
Respondent disallowed Crestmark’s claimed business expenses
on the grounds that it had failed to establish that these were
ordinary and necessary business expenses and that they were
expended for the purpose designated. With respect to the meals
and entertainment expenses, respondent also determined that
Crestmark failed to meet the substantiation requirements of
section 274.
On brief, Crestmark concedes that the meals and
entertainment deductions have not been substantiated. We
conclude that Crestmark has also failed to establish the validity
of its other claimed deductions.
Section 162 generally allows a deduction for all the
ordinary and necessary expenses paid or incurred during the
taxable year in carrying on any trade or business. The
determination of whether an expenditure satisfies the
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