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Expense 1994 1995 1996
Car & truck $3,840.61 –- $1,722.89
Travel 7,627.35 $6,669.83 3,752.40
Meals & ent. 385.39 1,385.75 306.31
Other:
Parking 358.55 –- 190.40
Lodging –- 1,965.39 814.14
In support of these expenses, petitioners produced various
receipts and statements purporting to show the actual
expenditures. However, petitioners failed to produce credible
evidence, if any evidence at all, as to the business purpose of
each expense. Moreover, petitioners failed to introduce evidence
establishing the business relationship to petitioner with any
persons purportedly being entertained or using the facilities or
property rented by petitioner.
Petitioners’ evidence with respect to these expenses does
not satisfy the stringent substantiation requirements of section
274(d). Moreover, as noted earlier, the Court cannot allow or
estimate an allowable deduction for any of these expenses under
the Cohan rule. Thus, the Court holds that petitioners are not
entitled to deduct any of the claimed expenses for the years at
issue in excess of what was allowed by respondent.8
8 As stated previously, respondent conceded that
petitioners are entitled to deductions for meals and
entertainment expenses (prior to the 50-percent limitation)
totaling $112.45 for 1994. This amount will be taken into
(continued...)
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