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Petitioners have established that Mrs. Whitehurst purchased
and used the computer and computer-related equipment in her trade
or business and have satisfied the requirements of section 274.
We conclude that petitioners are entitled to a depreciation
deduction for the fax machine, the computer, and the software
diskettes, purchased in 1998 for $931.99. We also conclude that
petitioners are entitled to a deduction for computer services of
$85 for 1999 and a depreciation deduction for the printer cable
purchased in 1999 for $31.49.
Mr. Whitehurst did not provide any testimony or written
evidence as to the amount spent on supplies purchased and used in
the course of his employment. It is not clear that the expenses,
if any, were unreimbursed by his employer or that they were
ordinary and necessary to the carrying on of his trade or
business under section 162(a). We conclude that petitioners are
not entitled to a deduction for unreimbursed employee expenses
for equipment and supplies purchased with respect to Mr.
Whitehurst’s employment.
Reviewed and adopted as the report of the Small Tax Case
Division.
To reflect the foregoing,
Decision will be entered
under Rule 155.
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