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Beck's Liquors checking account. The nonincome items should be
increased to reflect those nontaxable deposits.
The insurance company paid to Mr. Beck death benefits of
$4,934 in 1991, $6,543 in 1992, and $5,328 in 1993. The
insurance payments were deposited into the State Bank account.
The payments are not income to Beck's Liquors, and the nonincome
amount should be increased by those amounts.
B. Disallowed Expenses
Respondent disallowed certain of Beck's Liquors' business
expense deductions reported on the corporation's returns for
1991, 1992, and 1993 in the respective amounts of $46,060,
$26,476, and $30,204.
Petitioner was unable to substantiate some of the expenses.
Some of the expenses were personal living expenses that are not
deductible pursuant to section 262. The primary items in dispute
are (1) payments in lieu of wages, (2) vehicle expenses and
depreciation, (3) annual meeting expenses, (4) travel and
entertainment expenses, (5) insurance, condominium fees,
utilities, and property taxes paid for residences of Mr. Beck,
Michael, and/or Michelle, (6) charges on the corporate VISA card
for Mr. Beck's personal expenses, (7) Mrs. Beck's funeral and
medical expenses, and (8) payments made to churches and
charitable organizations in memory of Mrs. Beck.
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