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to do business in Nigeria in corporate form. The law is clear
that as a general rule, a taxpayer may not deduct the expenses of
another taxpayer. Deputy v. du Pont, 308 U.S. 488 (1940); Hewett
v. Commissioner, 47 T.C. 483 (1967); see Moline Props., Inc. v.
Commissioner, 319 U.S. 436, 438-439 (1943) (the business of a
corporation is separate and distinct from the business of its
shareholders); Crook v. Commissioner, 80 T.C. 27, 33 (1983)
(same), affd. without published opinion 747 F.2d 1463 (5th Cir.
1984). Under this rule, a shareholder, even a majority or sole
shareholder, may not deduct payments made by the shareholder of
the corporation’s expenses. E.g., Rink v. Commissioner, 51 T.C.
746, 751 (1969). Although there is a narrow and limited
exception to this rule, see Lohrke v. Commissioner, 48 T.C. 679,
684-685 (1967), petitioner did not demonstrate that the exception
to the general rule should apply in his case, see Capital Video
Corp. v. Commissioner, 311 F.3d 458, 464 (1st Cir. 2002), affg.
T.C. Memo. 2002-40.
In view of the foregoing, we hold for respondent on this
issue.
4. Legal/Professional Expenses
On his Schedule C for 2000, petitioner claimed a deduction
for legal and professional services in the amount of $3,270.17
At trial, respondent conceded that petitioner substantiated the
17 Petitioner did not claim any deduction for legal or
professional expenses on his Schedule C for 1999.
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