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Respondent objects to the Court’s consideration of
petitioner’s request to deduct as business expenses two-thirds of
the expenses incurred in maintaining his home, because petitioner
did not assert the claim in his petition. Although petitioner
did not properly plead this issue, it was tried by consent and we
will decide it.
Petitioner has failed to establish his entitlement to deduct
two-thirds of the costs of maintaining his home (or any portion
of such costs). Under section 280A(c), no deduction is allowed
for expenses relating to a dwelling unit used as a residence,
unless a portion of the residence is “exclusively used on a
regular basis” as either the “principal place of business
* * * of the taxpayer” or “as a place of business which is used
by patients, clients, or customers in meeting or dealing with the
taxpayer in the normal course of his trade or business”.
Petitioner did not use his home as his only place of business.
He maintained business offices in Fresno, Merced, and Burbank.
In addition, petitioner failed to establish that his
residence was his principal place of business. The location of
the taxpayer’s important or significant business activities is an
important indicator of the principal place of business. In
Commissioner v. Soliman, 506 U.S. 168 (1993), the Supreme Court
held that an anesthesiologist’s principal place of business was
the hospital where he performed his medical services, not his
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