Rick and Ruth Baime Richards - Page 19

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          this is an ordinary and necessary business expense that                     
          petitioners incurred.  Accordingly, petitioners are entitled to a           
          deduction of $439.                                                          
               Petitioners claimed deductions of $1,114 for long distance             
          and $240 for “estimated” cash telephone calls.  Petitioners                 
          claimed these were business calls to producers, agents, artists,            
          managers, movie executives, and casting directors.  Petitioners             
          provided copies of their telephone bills for 1994.  It appears              
          that petitioners designated all long distance calls from their              
          residence as business calls. Petitioners did not detail whom                
          they called or the business purpose.                                        
               Since petitioners did not identify the business purpose of             
          any long distance calls, they are deemed to be personal under               
          section 262 and not deductible.                                             
               Vehicle Expense                                                        
               Petitioners drove a 1970 Ford truck during the year at                 
          issue.  Petitioners claimed a vehicle expense of $8,540 for the             
          business use of their vehicle.  This amount is based on 80                  
          percent of actual expenses attributed to the vehicle.                       
          Petitioners retained receipts for gas purchases, repairs,                   
          insurance, and registration.  Petitioners did not maintain                  
          records of the business or personal use of the vehicle.                     

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