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for the audit year is $531 determined as follows: 16.7% x
$15,884 (the original cost of the auto) x 20%.
VI. Supplies
On the 1994 tax return, under the heading “Other
Deductions”, petitioner deducted $8,900.50 for “Supplies”
(supplies). Of that amount, $2,765 remains in dispute.9 The
remaining amount claimed for supplies is as follows:
(1) Safe deposit box $30
(2) Registry of motor vehicles 498
(3) Condo application fee 100
(4) Furniture storage 730
(5) Office decorations 300
(6) FOIA request 488
(7) Entertainment 247
(8) Auto insurance 149
(9) Life insurance 90
(10) Medical bills 133
Total 2,765
Items (1)-(4) represent costs associated with Aline’s
relocation from Dallas to Florida. We find that petitioner’s
payment of those costs, like its payment of other costs
associated with Aline’s relocation, was not in connection with
petitioner’s business.
Item (5), office decorations, also represents a personal
benefit to the Duquettes, based upon our finding, supra sec. II.B
9 A portion of this difference is attributable to
petitioner’s concession prior to trial, that many of the
reimbursements for so-called supplies charged to American Express
by Norman related to nondeductible personal items.
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