Debra D. McNair - Page 14

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               Petitioner did not have any receipts for expenses in excess            
          of the $75 respondent allowed for the cellular telephone or the             
          $75 in postage, and accordingly, we sustain respondent with                 
          respect to these matters.                                                   
               With respect to her draft amended 2000 Schedule C,                     
          petitioner did not introduce any documentation except a bill from           
          her tax return preparer in the amount of $408.  As with her 1999            
          return, we hold that she is entitled to deduct half of that bill            
          on her Schedule C for the cost of preparing her 2000 Schedule C.            
          In addition, because of the lack of any further substantiation              
          and because of petitioner’s concessions, we sustain respondent’s            
          determination of petitioner’s receipts.1                                    
          3.  Accuracy-Related Penalties                                              
               Section 6662 provides that a taxpayer may be liable for a              
          penalty of 20 percent of the portion of an underpayment of tax              
          due to negligence or disregard of rules or regulations.                     
          “Negligence” is defined as any failure to make a reasonable                 

               1  Petitioner conceded the claim for education credits set             
          forth on her tax return for 2000.  During the hearing of this               
          case, petitioner conceded her claim for education expense                   
          deductions for 2000, and that concession negates any claim for              
          education credits.  In any event petitioner is not entitled to a            
          Hope Scholarship Credit under sec. 25A(b) because she failed to             
          show or even allege that she was a half-time student for any                
          portion of 2000.  Sec. 25A(b)(2)(B) and (3).  Petitioner is not             
          entitled to a Lifetime Learning Credit for 2000 because she                 
          failed to show that during 2000 she paid “qualified tuition and             
          related expenses” within the meaning of sec. 25A(c)(1) and as               
          defined in sec. 25A(f)(1).                                                  

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