-7-
expenses. Hartless Linen Serv. Co. v. Commissioner, 32 T.C. 1026
(1959).
Petitioners claimed charitable contribution deductions on
their Schedules C as ordinary and necessary business expenses.
In this proceeding, however, petitioners failed to provide any
proof that these claimed contributions were paid as legitimate
business expenses. We sustain respondent’s determination as to
this issue. See id. We allow petitioners to deduct these
amounts under section 170 as itemized deductions, as determined
by respondent.
3. Penalty Under Section 6673
Respondent moves the Court to require petitioners to pay to
the United States a penalty under section 6673. Respondent
asserts that petitioners’ positions in this proceeding are
frivolous and groundless. Under section 6673(a), a taxpayer may
be required to pay to the United States a penalty not in excess
of $25,000 whenever it appears to the Court that, among other
reasons, the proceedings have been instituted or maintained
primarily for delay or the taxpayer’s position is frivolous or
groundless. Larsen v. Commissioner, 765 F.2d 939, 941 (9th Cir.
1985). A taxpayer’s position is frivolous or groundless if it is
contrary to established law and unsupported by a reasoned, color
able argument for change in the law. Coleman v. Commissioner,
791 F.2d 68, 71 (7th Cir. 1986).
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