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and C., that neither the Dallas apartment nor the Florida
residence qualified as business premises of petitioner’s.
Petitioner’s description of item (6), its request under the
Freedom of Information Act (FOIA) "for tax information", does not
reveal whether the request related to respondent’s examination of
petitioner, of Norman, or to the criminal proceeding instituted
against Norman (discussed infra). As a result, petitioner has
not shown that that expense provided any business benefit to
petitioner.
Petitioner states that item (7), entertainment, represents
the cost of five "shows" at the Kennedy Center in Washington,
D.C.: Three attended by Norman and "a part-time consultant to
the petitioner" and two attended by Norman and employees of "a
major client".
Entertainment expenses are deductible to the extent that
they are (1) "directly related to" the "active conduct of the
taxpayer’s trade or business" or (2) "associated with" the
active conduct of such trade or business, and the entertainment
directly preceded or followed "a substantial and bona fide
business discussion". Sec. 274(a)(1)(A). In this case, the
entertainment was not "directly related entertainment" as defined
in section 1.274-2(c), Income Tax Regs. See sec. 1.274-
2(c)(7)(ii)(a), Income Tax Regs. Also, it does not qualify as
"associated" entertainment because petitioner has failed to offer
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