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determination on this issue. Petitioner has failed to prove it
wrong.
2. Self-Employment Expenses
Section 162(a) lets taxpayers deduct all ordinary and
necessary expenses paid during the taxable year in carrying on a
trade or business. Section 262(a) generally prohibits a taxpayer
from deducting personal, living, or family expenses.
Respondent determined that petitioner was not engaged in a
trade or business on the Oceanside Blvd. property and disallowed
the business deductions which petitioner claimed for expenses
related to that property. Respondent argues that petitioner used
the Oceanside Blvd. property only for personal purposes.
We disagree. We have found as a fact that petitioner operated at
least Delta’s business on the Oceanside Blvd. property and that
petitioner’s personal use of the Oceanside Blvd. property was
limited solely to the apartment. Although respondent disputes
whether petitioner actually worked on the Oceanside Blvd.
property during the subject years, the fact of the matter is that
at least Delta’s business was located on the property, and
Delta’s business generated approximately $18,000 of gross
receipts during 1989 through 1991.4 We are confident that
4 We also are mindful of the fact that we have just
sustained respondent’s determination that petitioner failed to
report self-employment income for the subject years totaling
$210,117.
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Last modified: May 25, 2011