- 6 - He also visited his father on these trips. Petitioner provided no record of his mileage and failed to meet the strict substantiation requirements of section 274(d). Accordingly, we find that petitioner is entitled to deduct only the $382.68 of union dues expense conceded by respondent. Petitioner deducted $3,600 of expenses for legal fees and "claim of right" and $8,150 of other miscellaneous expenses for the "claim of right". He did not know how the $3,600 amount was allocated between the two expenses. Legal fees may be deductible as an itemized deduction under section 212 if they are paid for the production or collection of income or for the management, conservation, or maintenance of income producing property. Petitioner did not substantiate that he paid the legal fees, nor did he establish his right to deduct them under section 212. In regards to the "claim of right" expenses, it appears that petitioner borrowed money from a Mr. Ashley and Mr. Ashley then sued to collect the money. Petitioner testified that the "claim of right" expenses were the amounts he transferred to Mr. Ashley in repayment of the loan. There was no documentation supporting petitioner's testimony that these payments were actually made. In any event, it is well established that deductions are not permitted on account of the repayment of loans. Brenner v. Commissioner, 62 T.C. 878, 883 (1974); Clark v. Commissioner, T.C. Memo. 1994-120, affd. without published opinion 68 F.3d 469Page: Previous 1 2 3 4 5 6 7 8 9 Next
Last modified: May 25, 2011