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that they failed to establish any connection between the use of
the rug and petitioner’s law practice. In addition, respondent
contends that petitioners have not shown that the expense was an
ordinary and necessary business expense.12
Petitioners purchased the rug during 1993 and had it
appraised and repaired that same year. The fact that petitioners
had the rug appraised and repaired in the year of purchase
suggests that those repairs were part of their capital investment
in the rug. Cf. Stoeltzing v. Commissioner, 266 F.2d 374 (3d
Cir. 1959), affg. T.C. Memo. 1958-111; Bloomfield S.S. Co. v.
Commissioner, 33 T.C. 75 (1959); Jones v. Commissioner, 24 T.C.
563 (1955), affd. 242 F.2d 616 (5th Cir. 1957); L.A. Wells
Constr. Co. v. Commissioner, 46 B.T.A. 302 (1942), affd. per
curiam 134 F.2d 623 (6th Cir. 1943); H. Wilensky & Sons Co. v.
Commissioner, 7 B.T.A. 693 (1927). Petitioners offered no
evidence regarding the condition of the rug before and after it
was repaired, nor did they prove what effect the repairs had on
the value of the rug. Petitioners have not carried their burden
of proving that the expenditure was an ordinary and necessary
expense of carrying on petitioner’s law practice. Accordingly,
we sustain respondent’s determination.
12Respondent also argues that, to the extent the expense is
allowable, the expenditure is a capital expenditure that should
be added to the basis of the rug.
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