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by petitioner stated the date, vendor, description, invoice
number, amount, and mileage (where relevant) for each
expenditure. Each annual list was attached to an envelope
containing receipts for the expenses. Some of petitioner’s
expenses were for travel away from home for trade shows, and the
rest were for expenses not covered by section 274(d) (i.e.,
equipment for IMC’s business).
As described above, respondent allowed petitioners
deductions from adjusted gross income under section 162 for the
1996, 1997, 1998, and 1999 expenses listed in the exhibits
submitted at trial. These lists of expenses were the lists
petitioner created for substantiation of his expenses to Mr.
Kerkinni. The substantiation rules for business expense
deductions under sections 162 and 274(d) are incorporated by
section 1.62-2(e)(1) through (3), Income Tax Regs., for the
purpose of determining whether a reimbursement arrangement
constitutes an accountable plan. In the notice of deficiency and
on brief, respondent accepted petitioner’s lists as proper
substantiation under section 162, and we agree that petitioner
has met the substantiation requirements of section 162. We
believe that petitioner’s lists of expenses were also
sufficiently detailed to qualify as proper substantiation under
the requirements of section 274(d), where applicable.
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