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made in order to obtain tax advantages.” Framatome Connectors
USA Inc. v. Commissioner, 118 T.C. 32, 70 (2002) (citing Estate
of Leavitt v. Commissioner, 875 F.2d 420, 423 (4th Cir. 1989),
affg. 90 T.C. 206 (1988), and Grojean v. Commissioner, 248 F.3d
572, 576 (7th Cir. 2001), affg. T.C. Memo. 1999-425). Here,
inasmuch as Mr. Schmidt farmed the Schmidt farm as a tenant, and
not as an employee of Hillside Dairy, the food and lodging in
question were not furnished to Mr. Schmidt as a corporate
employee for the convenience of his employer. Thus, the food and
lodging expenses at issue are not section 119(a) meals and
lodging expenses.
2. Deductibility of Expenses Related to the Leasing of the
Schmidt Farm
During the years at issue, Hillside Dairy’s business
activities included leasing the Schmidt farm. It leased the
farm, including the farmhouse, to the Schmidts and received rent.
Therefore, we look to the terms of the farm lease to determine
whether expenses for insurance, utilities, depreciation, and
taxes are the expenses of Hillside Dairy or the Schmidts.
a. Property Insurance
Hillside Dairy deducted $120 in 1996 and $132 in 1997 for
property insurance. “Certain business-related insurance expenses
unquestionably are deductible under section 162(a).” Metrocorp,
Inc. v. Commissioner, 116 T.C. 211, 245 (2001) (citing section
1.162-1(a), Income Tax Regs.). The farm lease does not require
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