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Tokarski v. Commissioner, 87 T.C. 74, 77 (1986). We do not find
petitioner’s testimony to be credible regarding this issue.
Petitioner relies on the following cases for the proposition
that Export’s corporate form should be disregarded because of the
lack of corporate activity: Barker v. Commissioner, T.C. Memo.
1993-280; Lukins v. Commissioner, supra; Czvizler v.
Commissioner, a Memorandum Opinion of this Court dated Apr. 9,
1953; and Bystry v. United States, 596 F. Supp. 574 (W.D. Wis.
1984). Petitioner’s reliance on these cases is misplaced.
Unlike the corporations in Barker, Czvizler, and Bystry, Export
held itself out to the public as a corporation, and petitioner
held himself out to the public as the president of Export. The
present case is also distinguishable from all of the cases he
cites because Export engaged in business activity and had a valid
business purpose during 1996 and 1997.
Even if we disregarded Export’s corporate form, petitioner
would not prevail regarding the post-incorporation deductions.
Petitioner failed to meet the requirements of sections 162(a) and
274(a). Therefore, we sustain respondent’s determination.
B. Pre-Incorporation Schedule C Expenses
1. Sections 162(a) and 274(a)
Section 162(a) permits a deduction for the ordinary and
necessary expenses paid or incurred during the taxable year in
carrying on a trade or business. To be deductible under that
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