- 26 - For 1995, petitioners deducted legal and professional expenses of $7,920, of which respondent allowed $5,000. The remaining $2,920 amount was disallowed in the notice of deficiency. In support of the deductibility of this $2,920, petitioners produced canceled checks showing the following payments: Date Payee Amount 01/13/95 Susan Javellana $ 500 01/23/95 Betty Crutcher 500 01/23/95 Jim Costa 70 07/28/95 Tanya L. Lynch 400 07/28/95 Antonio Cristi 100 07/28/95 Tanya Oliver 100 07/28/95 Vanessa M. Taylor 550 12/15/95 Titi Oconnor 700 Total $2,920 All of these checks were signed by petitioner; however, none listed a notation in the memo section as to the purpose or reason for payment, nor whether the payees were attorneys. Moreover, no evidence was presented to show the relationship of most of these payees to petitioner’s business activities. Finally, no evidence was presented that would indicate these payments were incurred in petitioner’s trade or business. Thus, the Court holds that these expenses are not deductible. For 1996, petitioners deducted $468.54 in legal and professional expenses, all of which was disallowed by respondent.Page: Previous 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 Next
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