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residences. The exception clearly applies in situations where
the dwelling unit is the sole fixed location of the trade or
business. Because petitioner had an office, her fixed place of
business, other than her residences, section 280A(c)(2) does not
apply. See Garvey v. Commissioner, T.C. Memo. 1982-176.
Moreover, petitioner’s equipment and supplies for her cleaning
business do not constitute inventory, as required under the
statute. See Banatwala v. Commissioner, T.C. Memo. 1992-483.
Accordingly, petitioner failed to establish that she is
entitled to deduct additional rents in excess of the amounts
respondent allowed. Respondent is sustained on this issue.
7. Utilities
Petitioner claimed utility expense deductions of $3,341,
$2,864, and $3,724 in 1991, 1992, and 1993, respectively.
Respondent allowed $1,553, $1,564, and $1,220, respectively. At
trial, petitioner agreed to 90 percent of respondent’s
adjustments. Petitioner admits that personal utility expenses
were incorrectly deducted in 1991, 1992, and 1993. However, she
continues to contend that she is entitled to 10 percent of the
disallowed utility expense deductions. It was also determined
that in 1991, yellow page advertisements charged to petitioner’s
telephone bills, were already included in petitioner’s claimed
utility expenses for that year, and no additional amount was
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