Sandra B. Ball and Keirh M. Northrop - Page 5




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          was not substantial.  Hart v. Commissioner, supra (trading was              
          not substantial where taxpayer had 36, 30, and 15 sales of stock            
          during each of the years in question); Paoli v. Commissioner,               
          T.C. Memo. 1991-351 (trading was not substantial where taxpayer             
          had 326 sales transactions, but sales were not regular and                  
          continuous).  Accordingly, we find that petitioner was an                   
          investor, not a trader, and he is not allowed to deduct                     
          investment related expenses under section 162.                              
               Petitioners failed to substantiate the expenses in dispute             
          as required under section 6001.  Petitioner had no books and                
          records.  His handwritten notes do not constitute evidence of               
          interest payments.  His cash register receipts for alleged                  
          computer purchases do not total the amount claimed, nor do they             
          show the method of depreciation used.  There is nothing in the              
          record about office expenses.  In short, respondent disallowed              
          these expenses for, inter alia, lack of substantiation.                     
          Nevertheless, at trial petitioner failed to substantiate his                
          expenses.  Therefore, petitioners may not deduct such expenses              
          under section 212.  We hold for respondent on these issues.                 















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