- 8 -
Tax Regs. The regulations provide that, within this category of
expenses:
Only the minimum education necessary to the retention
by the individual of his established employment
relationship, status, or rate of compensation may be
considered as undertaken to meet the express
requirements of the taxpayer’s employer.
Sec. 1.162-5(c)(2), Income Tax Regs. As discussed above, during
the year in issue petitioner had left his former employment and
had not yet started his new employment. Thus, because petitioner
did not have an established employment relationship, status, or
rate of compensation during that year, petitioner is not entitled
to a deduction pursuant to the second category of deductible
expenses under section 1.162-5(c)(2), Income Tax Regs.
Because petitioner’s education expenses do not fall into
either category of deductible expenses under the regulations,
petitioner is not entitled to the deductions claimed for the
M.B.A. program. We need not address whether the expenses fall
into either of the categories of nondeductible expenses under
section 1.162-5(b), Income Tax Regs.
Reviewed and adopted as the report of the Small Tax Case
Division.
To reflect the foregoing,
Decision will be entered
for respondent.
Page: Previous 1 2 3 4 5 6 7 8 9
Last modified: May 25, 2011