- 123 -
Claimed Claimed Telephone
Year Interest Deduction Expense Deduction
1991 $1,632.18 $2,122.52
1992 2,426.48 1,963.19
Petitioner further contends for the first time in petitioner’s
further trial memorandum and on brief that he is entitled to a
Schedule C deduction for 1992 for his payment in that year of an
alleged loan guaranty of $20,000.80
Section 162(a) generally allows a deduction for ordinary and
necessary expenses paid or incurred during the taxable year in
carrying on a trade or business. The determination of whether an
expenditure satisfies the requirements for deductibility under
section 162 is a question of fact. Commissioner v. Heininger,
320 U.S. 467, 475 (1943). In general, an expense is ordinary if
it is considered normal, usual, or customary in the context of
the particular business out of which it arose. Deputy v. du
Pont, 308 U.S. 488, 495 (1940). Ordinarily, an expense is
necessary if it is appropriate and helpful to the operation of
the taxpayer's trade or business. Commissioner v. Tellier, 383
U.S. 687, 689 (1966); Carbine v. Commissioner, 83 T.C. 356, 363
(1984), affd. 777 F.2d 662 (11th Cir. 1985).
Section 212(1) allows a deduction for ordinary and necessary
expenses paid or incurred during the taxable year, inter alia,
80In petitioner’s further trial memorandum and on brief,
petitioner claims that he deducted the $20,000 payment at issue
for 1992 in Schedule C of the joint return for that year. The
record does not support petitioner’s claim. The 1992 joint
return of petitioner and Ms. Brodsky does not claim any $20,000
deduction relating to an alleged payment on a loan guaranty in
Schedule C or anywhere else in that return.
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