- 5 - The second issue for decision is whether petitioner is entitled to miscellaneous itemized deductions for employee business expenses in each of the years in issue. Petitioner claimed miscellaneous itemized deductions for employee business expenses in the amounts of $14,875.54 for 1995 and $5,974.66 for 1996. Respondent disallowed the miscellaneous itemized deductions in full because petitioner had not established both that the expenses shown were paid or incurred during the taxable year and that they were ordinary and necessary to his business. Section 162(a) allows a deduction for the ordinary and necessary expenses paid or incurred during the taxable year in carrying on a trade or business. A taxpayer may be in the trade or business of being an employee. See Primuth v. Commissioner, 54 T.C. 374, 377-378 (1970). In order for a taxpayer to be engaged in a trade or business, “the taxpayer must be involved in the activity with continuity and regularity”. Commissioner v. Groetzinger, 480 U.S. 23, 35 (1987). An ordinary expense is one that relates to a transaction “of common or frequent occurrence in the type of business involved”, Deputy v. du Pont, 308 U.S. 488, 495 (1940), and a necessary expense is one that is “appropriate and helpful” for “the development of the petitioner’s business,” Welch v. Helvering, 290 U.S. 111, 113 (1933). Finally, job search expenses are deductible under section 162(a) to the extent they are incurred in searching forPage: Previous 1 2 3 4 5 6 7 8 9 10 Next
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