Eugene Clark - Page 5

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          “ordinary” the transaction which gives rise to the expense must             
          be of a common or frequent occurrence in the type of business               
          involved.  Deputy v. Du Pont, 308 U.S. 488, 495 (1940).  No                 
          deduction is allowed for personal, living, or family expenses.              
          Sec. 262(a).                                                                
               Generally, if a claimed business expense is deductible, but            
          the taxpayer is unable to substantiate it, the Court is permitted           
          to make as close an approximation as it can, bearing heavily                
          against the taxpayer whose inexactitude is of his or her own                
          making.  Cohan v. Commissioner, 39 F.2d 540, 543-544 (2d Cir.               
          1930).  The estimate must have a reasonable evidentiary basis.              
          Vanicek v. Commissioner, 85 T.C. 731, 743 (1985).  However,                 
          section 274 supersedes the doctrine of Cohan v. Commissioner,               
          supra, see sec. 1.274-5T(a), Temporary Income Tax Regs., 50 Fed.            
          Reg. 46014 (Nov. 6, 1985), and requires strict substantiation of            
          expenses with respect to any listed property as defined in                  
          section 280F(d)(4).  Sec. 274(d).  Listed property includes any             
          passenger automobile or any other property used as a means of               
          transportation, and computers.  Sec. 280F(d)(4)(A)(i), (ii),                
               Actual expenses related to the business use of an automobile           
          are deductible under section 274, if substantiated.                         
          Alternatively, self-employed individuals may use the standard               
          mileage rate by multiplying the number of miles driven for                  

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