Danielle L. Clark-Hernandez - Page 11




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          See sec. 262(a).                                                            
               Generally, if a claimed business expense is deductible, but            
          the taxpayer is unable to substantiate it, the Court is permitted           
          to make as close an approximation as it can, bearing heavily                
          against the taxpayer whose inexactitude is of his or her own                
          making.  See Cohan v. Commissioner, 39 F.2d 540, 543-544 (2d Cir.           
          1930).  The estimate must have a reasonable evidentiary basis.              
          See Vanicek v. Commissioner, 85 T.C. 731, 743 (1985).                       
               Section 274 supersedes the doctrine in Cohan v.                        
          Commissioner, supra, see sec. 1.274-5T(a), Temporary Income Tax             
          Regs., 50 Fed. Reg. 46014 (Nov. 6, 1985), and requires strict               
          substantiation of expenses for travel, meals and entertainment,             
          and gifts, and with respect to any listed property as defined in            
          section 280F(d)(4), see sec. 274(d).  Listed property includes              
          any passenger automobile or any other property used as a means of           
          transportation.  See sec. 280F(d)(4)(A)(i) and (ii).                        
               A taxpayer is required by section 274(d) to substantiate a             
          claimed expense by adequate records or by sufficient evidence               
          corroborating the taxpayer’s own statement establishing the                 
          amount, time, place, and business purpose of the expense.  See              
          sec. 274(d).  Even if such an expense would otherwise be                    
          deductible, the deduction may still be denied if there is                   
          insufficient substantiation to support it.  See sec. 1.274-5T(a),           
          Temporary Income Tax Regs., supra.                                          






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