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the full amount specified in the instrument, then the payment
amount that does not exceed the sum payable for support shall be
considered a payment for child support. Sec. 71(c)(3); Blyth v.
Commissioner, 21 T.C. 275, 279 (1953).
Pursuant to the terms of the Report and the Order,
petitioner was directed to make biweekly payments to Ms. Richards
of $784.62. Petitioner produced documents indicating that he
paid Ms. Richards alimony of $2,729.466 in 1997; therefore,
petitioner is allowed a deduction for alimony in that amount.
Issue 4. Schedule C Expense Deductions
Deductions are a matter of legislative grace, and a taxpayer
must establish his right to the deductions claimed. INDOPCO,
Inc. v. Commissioner, 503 U.S. 79, 84 (1992).
Under section 162, a deduction is allowed for ordinary and
necessary expenses that are paid or incurred during the taxable
year in carrying on a trade or business. Sec. 162(a). Section
167 allows a depreciation deduction for property used in a trade
or business or held for the production of income. Sec. 167(a).
Generally, a taxpayer is required to substantiate deductions
by maintaining books and records sufficient to establish the
6 We have credited petitioner with a payment of alimony of
$346.84 on Sept. 14, 1997. While it may appear that this payment
was child support, petitioner met his child support obligation
for September 1997 and was not otherwise in arrears. Moreover,
petitioner did not designate the payment as child support as he
had done with the payments on Sept. 12 and 26, 1997.
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