Jon A. and Linda A. Jewett - Page 3

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          98-64, 1998-2 C.B. 825.  The parties stipulated that this full M            
          & IE rate deduction purportedly was supported by a “Sailor Travel           
          Statement” attached to petitioners’ return.                                 
               After petitioners’ return was filed, Johnson v.                        
          Commissioner, 115 T.C. 210 (2000), was issued.                              
               During the examination of petitioners’ return, petitioners             
          conceded that they were not entitled to the full M & IE rate                
          deduction as claimed.  Instead, petitioners conceded they were              
          entitled to the lesser total amount of $1,978, which represents             
          the “incidental expense” portion of the M & IE rate, as allowed             
          by Johnson v. Commissioner, supra.                                          
               The $9,169 adjustment in the notice of deficiency represents           
          the subtraction of the “incidental expense” of $1,978 from the              
          $11,147 expense claimed on petitioners’ return.                             
               Petitioners now seek a deduction for “actual expenses”                 
          incurred while in the course of travel.                                     
               As this Court noted in Johnson v. Commissioner, supra at               
          228, “taxpayers, to the extent that the amounts set forth in the            
          revenue procedures fail to reflect the actual cost of their                 
          incidental expenditures, are entitled to a deduction for their              
          actual expenses.  In such a situation, however, taxpayers must be           
          prepared to meet all the substantiation requirements, including,            
          especially, written documentation as to the amounts of those                
          costs.”  The Court goes on to refer to the section 274                      






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