- 15 -
and Los Angeles. In 1993, petitioner contends that Faye Oatis
and Linda Klyce traveled to San Diego and Yuma.
Petitioner has stipulated that Special O's claimed travel
expenses for the years at issue were paid from the personal funds
of petitioner or her sisters. Petitioner has failed to establish
that any of the claimed travel expenses were reimbursed by
Special O. A corporation is not entitled to deduct unreimbursed
shareholder expenses. See Lang Chevrolet Co. v. Commissioner,
T.C. Memo. 1967-212.
Additionally, both Special O and petitioner have failed to
provide this Court with either adequate records or sufficient
evidence corroborating the claimed travel deductions. Taxpayers
must substantiate any deductions claimed. See Hradesky v.
Commissioner, 65 T.C. at 90.
Section 162(a) allows a taxpayer to deduct "all the ordinary
and necessary expenses paid or incurred * * * in carrying on any
trade or business". Section 274(d) requires strict
substantiation of certain expenses including those incurred with
respect to meals, travel, and entertainment.
We hold that Special O is not entitled to claim travel
expenses in the amounts of $740.81, $2,497, and $1,529 for the
1991, 1992, and 1993 tax years, respectively. Respondent is
sustained on this issue.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Next
Last modified: May 25, 2011