Dennis J. and Carol R. Kraus - Page 15

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          responsibility for stale or unsold goods and that he would                  
          receive a full credit (be entitled to retain commissions) for               
          such merchandise.                                                           
               At trial, petitioner explained that the cost of goods sold             
          adjustment was based on commissions that could have been earned             
          on products that were not sold because they were returned to IBC.           
          We are at a loss to understand how petitioner could have been               
          out-of-pocket for the cost of such items under these                        
          circumstances, especially where IBC provided petitioner with a              
          credit for returned merchandise and IBC was required to pay                 
          commissions to petitioner even if the customer returned the                 
          D.  Petitioner’s Entitlement to Home Office Expenses                        
               On the 1997 and 1998 income tax returns, petitioner claimed            
          $7,965 and $6,443, respectively, as home office expenses.                   
          Section 280A generally prohibits the deduction of the costs of a            
          taxpayer’s residence.  Section 280A(c)(1), however, permits a               
          deduction for the allocable portion of a residence that is                  
          regularly and exclusively used as a taxpayer’s principal place of           
          business or as a place of business which is used by customers in            
          the normal course of the taxpayer’s trade or business.                      
               An employee is entitled to a home office deduction only if             
          such an office is required for the employer’s convenience.                  
          Frankel v. Commissioner, 82 T.C. 318, 325-326 (1984).  In that              

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