Eugene Clark - Page 7

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          the same year.  Rev. Proc. 95-54, 1995-2 C.B. 450.  Respondent is           
          sustained on this issue.                                                    
               Section 167(a) permits a depreciation deduction for the                
          exhaustion and wear and tear of property used in a trade or                 
          business.  In calculating the depreciation deduction of $12,600             
          petitioner included:  Office furniture ($1,900); Lexus automobile           
          ($6,800); and two computers ($3,900).  Of the amount claimed,               
          respondent allowed $4,579 comprising $1,900 for office furniture            
          and $2,679 for computers.                                                   
               At trial, petitioner offered into evidence an itemized NEA             
          credit card summary report for 1996 showing a payment of $1,163             
          to P.C. Warehouse.  After reviewing the NEA credit card summary             
          report, we find that petitioner substantiated the purchase of a             
          second computer in the operation of his business.  Accordingly,             
          petitioner is entitled to a total depreciation deduction of                 
          $5,742 for 1996.5                                                           
               The last issue is one raised by petitioner in his petition.            
          Petitioner claimed that the amount of gross receipts on Schedule            
          C was overstated by $11,022.  Thus, according to petitioner the             

          5    Petitioner elected to expense the cost of the two computers            
          purchased in 1996 under sec. 179 on Form 4562, Depreciation and             
          Amortization, and, therefore, is entitled to deduct the amounts             
          as reflected herein.                                                        

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