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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 expenses.
All other expenses petitioners incurred that would be deductible
as itemized deductions, such as, for example, tax preparation
fees, while allowable, would not exceed 2 percent of petitioners'
adjusted gross income under section 67(a). Thus, none of the
itemized deductions on Schedule A, Itemized Deductions, of
petitioners' returns for job expenses and most other
miscellaneous deductions are deductible. Respondent, therefore,
is sustained on this issue.
With respect to the third issue, petitioners contend they
should be absolved of liability for the section 6662(a) penalties
because they relied on the representations of their return
preparer.
Petitioners knew that the amounts claimed on their tax
returns were false. The Court specifically questioned Mrs.
Cisneros why she and her husband would allow tax returns prepared
for them that were incorrect. She testified:
THE WITNESS: Well, Mr. Beltran was very convincing. He
made us feel comfortable with what he told us. If we gave
him a reason why we thought maybe this was too high, or
where he came up with it, he just reassured us that
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