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See sec. 1.274-5T(c)(2)(i), Temporary Income Tax Regs., 50 Fed.
Reg. 46017 (Nov. 6, 1985).
If an expense comes within the requirements of section
274(d), this Court cannot rely on Cohan v. Commissioner, supra,
to estimate the taxpayer’s expenses with respect to that item.
See Sanford v. Commissioner, 50 T.C. 823, 827 (1968), affd. per
curiam 412 F.2d 201 (2d Cir. 1969).
When a taxpayer’s records are lost or destroyed through
circumstances beyond his control, he is entitled to substantiate
deductions by reconstructing his expenditures through other
credible evidence. See Malinowski v. Commissioner, 71 T.C. 1120,
1125 (1979); sec. 1.274-5A(c)(5), Income Tax Regs.
We address each expense with additional facts separately.
1. Vehicle
Petitioner claimed a deduction of $6,351 for vehicle
expenses on his 1993 return based on 22,683 alleged business
miles. Petitioner testified that he often had to drive customers
to other related dealerships on the island to look at cars or to
their credit unions or banks. Petitioner admitted that he often
took a car from the lot to use instead of driving his own.
Petitioner also claimed that he incurred mileage driving
customers home when they did not have a vehicle. It is not clear
how often petitioner drove the customers to the various places.
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