Thomas James Allen - Page 7

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                    Entertainment, gifts          $  193                              
                    Automobile expenses           1,950                               
                    Travel                          316                               
                                                  2,459                               
          None of these expenses were deducted by petitioner on Schedule C            
          of his return.                                                              
               Respondent reviewed the Form 2106, Employee Business                   
          Expenses, attached to petitioner’s 1998 return to support the               
          $4,007 automobile deduction claimed on Schedule A.  On that form,           
          petitioner reported 4,138 miles driven at $.325 per mile for an             
          amount of $1,345.  Petitioner also reported actual automobile               
          expenses of $2,662 for a total of $4,007.  For reasons not                  
          appearing in the record, respondent determined that petitioner              
          was entitled to an automobile expense deduction of $1,950, based            
          upon 6,000 miles traveled at the standard mileage rate of $.325             
          per mile for 1998.                                                          
               Petitioner claimed an advertising expense deduction of $450            
          on his 1998 Schedule C.  Petitioner informs us that he made signs           
          that he placed in the windows of various stores to advertise                
          goods that he held for sale.  He submitted no evidence either               
          that he spent $450 to produce the signs or that he paid $450 to             
          display them in the various store windows.  Respondent is                   
          sustained on this issue.                                                    
               Petitioner claimed a $403 depreciation expense deduction on            
          his 1998 Schedule C.  He admitted at trial that he was not                  






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