- 38 -
* * * * * * *
unless the taxpayer substantiates by adequate records or by
sufficient evidence * * * [Emphasis added.]
Note that in section 274(d)(1) the “away from home” language
is located within the parenthesis (whereas in section 162(a)(2)
that language is outside the parenthesis), making it clear that
all travel expenses are covered by the disallowance provision of
section 274(d). Note also the familiar definitions of “taxpayer”
in sections 1313(b) and 7701(a)(1) that include the term
“corporation”.3
Various tax treatises and court opinions explicitly or
implicitly recognize that the substantiation requirements of
section 274(d) apply to corporations, not just to employees of
corporations (as the majority opinion may be read to suggest).
For example, see Bittker & Eustice, Federal Income Taxation of
Corporations and Shareholders, par. 5.03[1], at 5-12 (7th ed.
2000); Stechel, 520 Tax Mgmt. (BNA), “Entertainment, Meals, Gifts
3 In his concurring opinion, Judge Ruwe notes that United’s
per diem allowances covering meal expenses for day trips are not
deductible as travel expenses under United States v. Correll, 389
U.S. 299 (1967). Rather, however, than qualifying as deductible
compensation under sec. 162(a)(1), such day trip meal expenses
remain nondeductible to United because they represent the payment
by United of personal living expenses of United’s employees. See
sec. 262 and the Supreme Court’s holding in Correll. With regard
to the various incidental travel expenses that also were included
in United’s day trip per diem allowances, they remain subject to
the substantiation requirements of sec. 274(d). See sec.
274(d)(1).
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