- 3 - Respondent disallowed the $18,748 per diem lodging expense deduction claimed by petitioner but allowed a deduction of $5,595 for the lodging expenses actually incurred while operating the business in Washington. The actual expenses were computed as follows: Rent $3,521 Electricity 257 Cable 178 Utilities 544 Entertainment 1,095 Total $5,595 Petitioner concedes that the maximum lodging deduction that he could claim in 1995 using a per diem rate would be $12,948, computed as the maximum Federal per diem rate multiplied by the 156 days that petitioner lived in Woodinville for business purposes. The maximum Federal per diem rate for lodging in King County, Washington, where Woodinville is located, was $83 per day during 1995. Discussion Petitioner contends that a self-employed individual is entitled to use the Federal per diem rate to substantiate expenditures for lodging away from home. Respondent claims that petitioner, as a sole proprietor, is precluded from using the Federal per diem rate and is entitled only to a deduction equal to his actual lodging expenses substantiated under section 274(d).Page: Previous 1 2 3 4 5 6 Next
Last modified: May 25, 2011