George Coloney - Page 10

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          undated, handwritten Estimated Income Tax Voucher for the 1994              
          taxable year and a New York income tax adjustment statement to              
          substantiate his State income tax deduction.                                
               As previously noted, the New York income tax adjustment                
          shows that petitioner estimated his New York State income taxes             
          to be $25,000 when he submitted Form IT-370, and had $2,610                 
          withheld in New York State income tax for the 1994 taxable year.            
          The Estimated Income Tax Voucher states that petitioner made an             
          estimated New York State income tax payment of $35,000.  However,           
          the Estimated Income Tax Voucher lacks credibility because                  
          petitioner has not produced a check or other evidence of actual             
          payment, and the amount shown thereon is inconsistent with the              
          amount shown on the New York income tax adjustment.                         
               We uphold respondent's determination that petitioner is                
          entitled to deduct, as an itemized deduction, only $2,610 which             
          is attributable to New York State income tax withheld because               
          this amount constituted payments of income tax made in 1994.                
          Petitioner has not shown that the $25,000 attributable to                   
          estimated tax payments submitted with Form IT-370 was paid in               
          1994.                                                                       
               Lastly, petitioner claims $16,500 in travel expenses and               
          $14,400 for meals and entertainment expenses.  In order to deduct           
          an expense pursuant to section 162(a), petitioner must show that            
          each item was (1) paid or incurred during the taxable year, (2)             





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