- 12 -
Even if the amount exceeded 7.5 percent of his adjusted
gross income, Mr. Cotton failed to substantiate his medical
expenses under section 1.213-1(h), Income Tax Regs. Mr. Cotton
did not indicate the recipient of any of the payments. In
regards to the $500 Mr. Cotton spent for copayments and emergency
room visits, Mr. Cotton did not indicate when the payments were
made, the name of the patient, or the reason for the treatment.
We hold for respondent.
5. Tax Preparer’s Fees
A taxpayer may deduct ordinary and necessary expenses
incurred in connection with the determination, collection, and
refund of taxes. See sec. 212(3). Such deductible expenses
include expenses incurred in connection with the preparation of
tax returns. See sec. 1.212-1(l), Income Tax Regs.
Where a taxpayer establishes that he has incurred certain
kinds of expenses but is unable to substantiate the precise
amount of the expenses, we may estimate the amount of the
deductible expenses. See Cohan v. Commissioner, 39 F.2d 540,
543-544 (2d Cir. 1930). We cannot estimate deductible expenses,
however, unless the taxpayer presents evidence sufficient to
provide some rational basis on which estimates may be made. See
Williams v. United States, 245 F.2d 559 (5th Cir. 1957); Vanicek
v. Commissioner, 85 T.C. 731, 742-743 (1985).
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