Gregory C. and Phyllis Lam - Page 5

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          property’s business and total usage, the date of the expenditure            
          or use, and the business purpose for an expenditure or use.  Sec.           
          274(d); sec. 1.274-5T(b)(6), Temporary Income Tax Regs., 50 Fed.            
          Reg. 46016 (Nov. 6, 1985).  To substantiate a deduction by means            
          of adequate records, a taxpayer must maintain an account book,              
          diary, log, statement of expense, trip sheets, and/or other                 
          documentary evidence, which, in combination, are sufficient to              
          establish each element of expenditure or use.  Sec. 1.274-                  
          5T(c)(2)(i), Temporary Income Tax Regs., 50 Fed. Reg. 46017 (Nov.           
          6, 1985).  Each element of an expenditure or use must be made at            
          or near the time of the expenditure or use.  Sec. 1.274-                    
          5T(c)(2)(ii)(A), Temporary Income Tax Regs., 50 Fed. Reg. 46017             
          (Nov. 6, 1985).  Moreover, when section 274(d) applies, as here,            
          this Court cannot rely on Cohan v. Commissioner, 39 F.2d 540 (2d            
          Cir. 1930), to estimate the taxpayer’s expenses.  Sanford v.                
          Commissioner, 50 T.C. 823, 827-828 (1968), affd. per curiam 412             
          F.2d 201 (2d Cir. 1969).                                                    
               Petitioner had no books of account or other records                    
          concerning his alleged businesses or any evidence of the                    
          expenditures in issue.  At trial, petitioner had no reconstructed           
          records to support his claimed deductions.  Petitioner’s                    
          miscellaneous documents from third parties and some items from              
          petitioner or his wife were not adequate to support any of his              
          deductions.  Petitioner relied on his own testimony.                        

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