Christopher Joseph Bush and Robin Leigh Pickering - Page 6

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          Schedule C Deductions                                                       
               Petitioners maintain that all deductions were part of a                
          legitimate business whose primary objective was to earn a profit.           
          Respondent’s position is that the contested deductions are                  
          unsubstantiated personal expenses.                                          
               Section 162(a) allows deductions for ordinary and necessary            
          expenses paid or incurred in carrying on a trade or business.               
          Generally, no deduction is allowed for personal, living, or                 
          family expenses.  Sec. 262.                                                 
               In this case, petitioner’s agreement with his stepdaughter             
          was in furtherance of the personal desires of both parents and              
          daughter that Jennifer should prepare herself for a career as a             
          ballerina.  Petitioners have not shown that payments for one’s              
          own daughter’s training and education conditioned upon the                  
          commitment of her future earnings are ordinary and necessary                
          business expenses.                                                          
               Generally, under section 183(a) and (b) individuals are not            
          allowed deductions attributable to an activity “not engaged in              
          for profit” except to the extent of gross income generated by the           
          activity.  Section 183(c) defines an activity “not engaged in for           
          profit” as any activity other than one for which deductions are             
          “allowable * * * under section 162 or under paragraph (1) or (2)            

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