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petitioners have failed to provide any evidence establishing that
Mrs. Favero’s claimed expenses were incurred for business
purposes. Section 162(a) allows a deduction for all the ordinary
and necessary expenses paid or incurred during the taxable year
in carrying on a trade or business. Section 262(a), however,
provides that no deduction is allowed for personal, living, or
family expenses. Taxpayers are required to maintain records
sufficient to substantiate their claimed deductions. Sec. 6001;
sec. 1.6001-1(a), Income Tax Regs. Mrs. Favero’s testimony was
vague, and the copies of checks and receipts submitted as
evidence of her business expenses provide no basis to determine
the nature of the expenditures. Petitioners, therefore, are not
entitled to the Schedule C deductions disallowed by respondent.
Petitioners likewise have failed to establish they are
entitled to Schedule E expenses beyond those allowed by
respondent. Although section 212 allows a deduction for ordinary
and necessary expenses paid or incurred during the taxable year
for the management, conservation, or maintenance of property held
for the production of income, nothing in the record establishes
that the expenses disallowed by respondent were incurred. At
trial, Mrs. Favero indicated that some of the copies of checks
and receipts she submitted into evidence related to the
automobile expenses claimed on petitioners’ Schedule E. As with
the Schedule C expenses, the copies of checks and receipts
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