Kevin E. O'Brien - Page 5




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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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