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Petitioner's signature gatherers were employed to gather
signatures with the express purpose of putting the puppet issue
on the November 1993 ballot. These signature gatherers were paid
by petitioner's Committee and certainly made statements
supporting the inclusion of the issue on the November 1993 ballot
while gathering signatures from the public in San Francisco.
This Court has consistently held that expenses incurred to
influence the public with respect to legislative matters,
decisions, or referendums are nondeductible. See Cloud v.
Commissioner, 97 T.C. 613 (1991); Southern Pac. Transp. Co. v.
Commissioner, 90 T.C. 771, 780-782 (1988). Taken as a whole,
petitioner's actions show a clear intent to influence the general
public. Petitioner formed his Committee, funded it with his own
money, sent out signature gatherers to qualify the issue for the
November 1993 ballot, and then secured voting slate approval of
Proposition BB from local political organizations. Petitioner is
now attempting to break out certain expenses and narrowly isolate
those expenses so they do not fall under the section 162(e)(2)(B)
exclusion. We are not persuaded by his argument in that respect.
Petitioner's claimed expenses are disallowed by section
162(e)(2)(B).
We therefore hold that petitioner is not entitled to claim
expenses incurred in putting the Officer O'Smarty issue on the
November 1993 ballot as section 162 deductions on his 1993
Federal income tax return.
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