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refusal to furnish any records in support of the claimed
deductions. We held that “when a taxpayer refuses to
substantiate his claimed deductions, the Commissioner is not
arbitrary and unreasonable in determining that the deductions
should be denied.” Id. at 837.
Unlike the taxpayer in Roberts, petitioner did not refuse to
substantiate her deductions. In fact, she provided voluminous
documentation on several occasions and for extended periods of
time to respondent’s revenue agent, Appeals officer, trial
counsel, and to this Court. Respondent’s blanket disallowance of
petitioner’s Schedule C deductions in the notices of deficiency
for 3 of the 4 years at issue was preceded by the revenue agent’s
apparent failure or refusal to examine the expense records that
petitioner had produced for his inspection. Although
petitioner’s expense records (consisting, for the most part, of
canceled checks, cash receipts, credit card statements, and other
pertinent documents) may not have been kept in a form pleasing to
the revenue agent, they were coded and organized by category,
they satisfied the books and records requirement of section
1.6001-1(a), Income Tax Regs., and they were auditable. See
Jackson v. Commissioner, 59 T.C. 312, 317-318 (1972).
Respondent’s disallowance of all of petitioner’s Schedule C
expenses for 3 of the 4 years at issue without any meaningful
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