- 7 - In a notice of deficiency dated January 16, 1997, respondent disallowed petitioner's total claimed Schedule C advertising expense deduction for the 1993 tax year. Respondent contends that petitioner's claimed advertising expenses were actually lobbying and political expenditures which are disallowed by section 162(e). OPINION Deductions are a matter of legislative grace. See New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440 (1934). A taxpayer bears the burden of proving that he is entitled to claimed deductions. See Welch v. Helvering, 290 U.S. 111, 115 (1933). Petitioner has advanced two alternative arguments in support of his claim that the expenses incurred should be allowable as an ordinary and necessary business deduction: (1) Petitioner contends that the claimed deduction represents Schedule C business expenses incurred by petitioner in his business as an entertainer; or, alternatively, (2) petitioner contends that the expenditures represent unreimbursed employee business expenses which are deductible on Schedule A. 1. Section 162(e)(2)(B) Exclusion Relying on Section 162(e), respondent contends that petitioner would not be entitled to deduct his claimed expenses even if they otherwise had been allowable deductions under section 162(a).Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: May 25, 2011