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(1990). Even if petitioners had properly raised this issue,
petitioner’s testimony was unclear, and no documentary evidence
was presented. Thus, petitioners have not substantiated any
expense they may have incurred for child care.
Petitioner also presented argument at trial that expenses
related to his employment as a car salesman should be Schedule C
expenses rather than Schedule A expenses. He argues that these
expenses should be deducted from his gross income in order to
arrive at his adjusted gross income. We disagree.
Section 62, which defines adjusted gross income, lists the
deductions from gross income which are allowed for the purpose of
computing adjusted gross income. Section 62(a)(1) states the
general rule that trade or business deductions are allowed for
the purpose of computing adjusted gross income “if such trade or
business does not consist of the performance of services by the
taxpayer as an employee”. Expenses of employment, if incurred by
performing artists or State or local government officials, or
under a reimbursement arrangement with the employer, are
deductible in computing the employee’s adjusted gross income.
See sec. 62(a)(2). Otherwise, employed individuals with
unreimbursed trade or business expenses of their employment must
itemize deductions for such expenses. See secs. 161 and 162.
Under section 67 these itemized deductions are subject to a 2-
percent floor.
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