Randolph John Beale - Page 13




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                  We conclude that petitioner did not meet his burden of proof                         
            with respect to his home office deductions.  Petitioner operated                           
            his consulting business out of a garage attached to his                                    
            residence.  Where a taxpayer's business is conducted in part in                            
            the taxpayer's residence and in part at another location, the                              
            following two primary factors are considered in determining                                
            whether the home office qualifies under section 280A(c)(1)(A) as                           
            the taxpayer's principal place of business:  (1) The relative                              
            importance of the functions or activities performed at each                                
            business location, and (2) the amount of time spent at each                                
            location.  See Commissioner v. Soliman, 506 U.S. 168, 175-177                              
            (1993).                                                                                    
                  Whether the functions or activities performed at the home                            
            office are necessary to the business is relevant but not                                   
            controlling, and the location at which goods and services are                              
            delivered to customers generally will be regarded as an important                          
            indicator of the principal place of a taxpayer's business, which                           
            must be given great weight and is a principal consideration in                             
            most cases.  See id. at 175, 176.  The relative importance of                              
            business activities engaged in at the home office may be                                   
            substantially outweighed by business activities engaged in at                              
            another location.  The Supreme Court has explained:                                        
                  If the nature of the business requires that its                                      
                  services are rendered or its goods are delivered at a                                
                  facility with unique or special characteristics, this                                
                  is a further and weighty consideration in finding that                               





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