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Repairs $2,257
Dues 1,118
Insurance 906
Legal services 644
Services 3,165
Supplies 1,214
Telephone and 1,147
communications (pager)
Utilities 3,539
Accordingly, we conclude that petitioner is entitled to deduct
these expenses.
Petitioner produced canceled checks and other information
concerning her business gifts. We are satisfied that petitioner
has provided credible evidence and has satisfied the requirements
of section 274(b) and section 1.274-3(a), Income Tax Regs.,
relating to the following business gift expenses: $5 (Schultz);
$50 (Burns and Henderson); $25 (Wells); $25 (Slater); $25
(Sullivan); $25 (Marsh); $16.28 (Berry); $72 (Rose, Wiley, and
Hytton); and $50 (Dorsey and Gray), for a total of $293.28 that
petitioner is entitled to deduct.
4. Schedule E Loss
On Schedule E petitioner reported nonpassive income of
$1,962 and claimed a nonpassive loss of $5,249, which respondent
disallowed. Petitioner indicated that both the loss and income
flowed through from a partnership as reported on a Schedule K-1.
The Schedule K-1 issued by Sams, Inc. reflects income of $1,962
but does not reflect the nonpassive loss of $5,249. Petitioner
has failed to substantiate the claimed nonpassive loss of $5,249.
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