Jan and Corinne Mejnartowicz - Page 6

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               With regard to the deductions for casual labor and                     
          insurance, we are not satisfied that the unavailability of the              
          records maintained by his accountant explains his failure to                
          substantiate these deductions.  There are other reasonable means            
          that petitioner could have used to substantiate these deductions.           
          He could have called as witnesses the persons he employed, and he           
          could have obtained information from the insurance company.  We,            
          therefore, sustain respondent’s disallowance of these deductions.           
               The remaining issue deals with the $8,000 reduction to                 
          petitioner’s cost of goods sold.  On his Schedule C, petitioner             
          reported gross receipts of $26,864 and cost of goods sold of                
          $13,569.  The ratio between the gross receipts and cost of goods            
          sold is roughly 2:1.  We note that in the Internal Revenue                  
          Service “Statistics of Income Bulletin”, Summer 1998, Vol. 18,              
          No. 1, at 25, total gross receipts and cost of goods sold for               
          plumbing sole proprietorships for 1996 were $10.2 billion and               
          $5.2 billion, respectively, almost the identical 2:1 ratio as               
          shown by petitioner.  We do not believe that there would be a               
          significant difference between 1995 and 1996.  Respondent’s                 
          reduction of $8,000, therefore, would appear to be out of line,             
          and, using our best judgment, we believe that the cost of goods             
          sold would be $11,569.  See Cohan v. Commissioner, supra.                   

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