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and Lodging–-Deduction and Recordkeeping Requirements,” at A-33
(1998); 6 Mertens, Law of Federal Income Taxation, ch. 25D
(1998), for implicit recognition of the application of the
substantiation requirements of section 274(d) to corporations;
see also numerous published court opinions illustrating the
application of the substantiation requirements of section 274(d)
to corporations: Meridian Wood Prods. Co. v. United States, 725
F.2d 1183, 1188-1189 (9th Cir. 1984); Ma-Tran Corp. v.
Commissioner, 70 T.C. 158, 169-170 (1978); Buddy Schoellkopf
Prods., Inc. v. Commissioner, 65 T.C. 640, 642-645 (1975); Henry
Schwartz Corp. v. Commissioner, 60 T.C. 728, 741-743 (1973).
Also, under section 274(a), Congress restricted the
deductions for entertainment, amusement, and recreation expenses
where such expenses are not directly related to or associated
with the active conduct of a taxpayer’s trade or business. Under
section 274(e), however, Congress provided an exception for such
expenses where a taxpayer affirmatively elects to treat, and in
fact does so treat, the expenses as wage compensation subject to
income and employment tax withholding.
Congress obviously knew how to provide a recharacterization
option and an election out of the section 274(d) substantiation
requirements. Had Congress intended to provide taxpayers such as
United with a similar recharacterization option and an election
out of the substantiation requirements of section 274(d) for
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