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transport the generator system, and to travel to different
locations to distribute brochures about their business.
Respondent did not challenge petitioners’ substantiation of these
expenses, and nothing in the record contradicts petitioner’s
testimony.
We find that petitioners are not entitled to deductions for
$340 of utility expenses. These expenses were incurred for cable
television. Petitioner testified that the cable was necessary
because he liked to watch the news. These expenses are personal
and not attributable to petitioners’ business. We also find that
petitioners are not entitled to deductions for travel and meal
and entertainment expenses as petitioners have provided no
evidence that these expenses were related to their business.
Finally, we address the accuracy-related penalty imposed
pursuant to section 6662(a). Section 6662(a) and (b)(1) imposes
a penalty on any portion of an underpayment that is attributable
to negligence or disregard of rules or regulations. The term
“negligence” includes any failure to make a reasonable attempt to
comply with the statute, and the term “disregard” includes any
careless, reckless, or intentional disregard. Sec. 6662(c). The
penalty does not apply to any portion of an underpayment for
which there was reasonable cause and with respect to which the
taxpayer acted in good faith. See sec. 6664(c).
Petitioners bear the burden of proving that the accuracy-
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