Rick and Ruth Baime Richards - Page 16

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          not met the stringent requirements of section 274(d), and they              
          are not entitled to a deduction for travel, meals, and                      
               Petitioners also took two “research” trips in 1994.                    
          Petitioners went to Alaska and Mexico; these trips cost $3,296              
          and $1,319, respectively.  On petitioners’ return it is explained           
          that the purpose of these trips was to “obtain on-site data and             
          photos for in-progress development of screenplay project.”  Mr.             
          Richards testified that Mrs. Richards went along on the trips as            
          his photographer.  The costs included airfare for both                      
          petitioners, cruise fare, escorted side tours, travel insurance,            
          and incidental expenses.  Mr. Richards testified that they went             
          to Mexico to see a comedienne, a prospect for whom he thought he            
          could write material.  Mr. Richards did not state whether he ever           
          wrote material for the comedienne.                                          
               The expenses for these research trips also fall under the              
          requirements of section 274(d), and we find that petitioners have           
          failed to satisfy such requirements.  Petitioners have proven               
          that they incurred these expenses, but they have not established            
          that these expenses were sufficiently connected to a trade or               
          business.  Trips consisting of cruises, sightseeing, and tours              
          are essentially for personal enjoyment, and petitioners have not            
          proven otherwise.  Therefore, respondent is sustained on this               

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Last modified: May 25, 2011