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travel expenses, petitioner did not state to which Schedule C
business the receipts for the expenses related.
We believe that some of these expenses were personal
expenses. Moreover, petitioner did not adequately substantiate
his travel, car and truck, and computer expenses under the strict
requirements of section 274(d). Travel, car and truck, and
computer expenses cannot be estimated under Cohan. Sanford v.
Commissioner, 50 T.C. 823, 827-828 (1968), affd. per curiam 412
F.2d 201 (2d Cir. 1969). Based on the record, we allow
petitioners to claim $2,000 of expenses on the Attorney/Sales
Consultant Schedule C, $1,000 of cost of goods sold and $100 of
expenses on the Sales-Antiques & Jewelry Schedule C, and $12,000
of expenses on the Oil/Gas Operating Interest Schedule C.
Section 1401 imposes a tax upon a taxpayer's self-employment
income. Self-employment income includes the net earnings from
self-employment derived by an individual during the taxable year.
Sec. 1402(b). Net earnings from self-employment consist of gross
income derived by an individual from any trade or business
carried on by such individual, less the allowable deductions that
are attributable to such trade or business, plus certain items
not relevant here. Sec. 1402(a). A deduction for one half of
the self-employment tax is allowed under section 164(f). We find
that petitioners are liable for self-employment tax on the income
earned from the Schedule C businesses and are entitled to the
corresponding deduction.
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