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2. Meals and Entertainment
The next issue is whether petitioner can deduct meals and
entertainment expenses of $10,270 in 1993 and $6,242 in 1994.14
Petitioner argues on brief that he failed to produce adequate
records to substantiate his expenses because the records were
lost in the process of closing an office and moving to another
one.15
Section 162(a) allows a deduction for all ordinary and
necessary expenses paid or incurred in carrying on a trade or
business. However, no deduction is allowed under section 162
with respect to any traveling expense, including meals while away
from home, or for any entertainment expenses, unless the taxpayer
meets strict substantiation requirements. See sec. 274(d); sec.
1.274-5T(b) and (c), Temporary Income Tax Regs., 50 Fed. Reg.
46014, 46016 (Nov. 6, 1985). Section 274(d) provides that no
deduction will be allowed for any traveling expense,16 or for any
activity which is generally considered to constitute
14Petitioner deducted $10,270 in 1993 and $6,242 in 1994,
and respondent disallowed both deductions. In order to
substantiate his deductions, petitioner submitted checks drawn in
1993 and 1994 totaling $12,286.76 and $9,492.32, respectively.
15Petitioner testified that he was unable to provide
receipts for the expenses because they were lost in the process
of closing an office and moving to another office. Petitioner
testified that he moved his office in 1993.
16See sec. 274(d)(1).
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