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the salaries and wages petitioners earned each year. The amounts
claimed allegedly represented the costs petitioners incurred in
using their personal vehicles in connection with their
employment. Some of the expenses also were for what petitioners
identified as "Work/Tool Expenses".
Petitioners did not maintain any log or other record
documenting the dates, times, and places their vehicles were used
in connection with their respective employments during the years
in question.
The deductions cannot be allowed for the reason that, under
section 274(d) and the regulations thereunder, vehicle expenses
are subject to strict substantiation rules that require "adequate
records" through either an account book, diary, statement of
expense, or similar record, as well as documentary evidence to
establish each element of an expenditure. Sec. 1.274-
5T(c)(2)(i), Temporary Income Tax Regs., 50 Fed. Reg. 46017 (Nov.
6, 1985). No records were presented at trial to substantiate
these expenses; consequently, respondent is sustained on the
disallowance of the employee business expense deductions.7
7 The Forms W-2, Wage and Tax Statement, that were
offered in evidence with petitioners' tax returns indicate that
petitioner Steven L. Chambers was an employee of the United
States Government. The Court is very skeptical that a Federal
employee incurring job-related expenses of the magnitude claimed
on petitioners' returns would not have been reimbursed in whole
or in part by the employing Federal agency.
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