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In at least two instances, petitioners apparently attempted
to deduct tickets purchased to entertainment events produced by
third parties. An expenditure labeled “TICKET SALES” for ASU
Gammage in October of 1998 was deducted by KareMor under the
training, meetings, and/or conventions category, and Mrs. Deihl
testified: “I do know, I do vaguely recall the fact that we took
quite a few distributors during one of the meetings or
conventions that was here to Gammage for a program. I don’t
remember what the program is.” Petitioners also claimed a
$21,220 deduction through KareMor for tickets to one or more
Arizona Diamondbacks baseball games. They characterized this
expense as one for meals and entertainment but offered no
evidence or argument at trial or on brief. Both of these items
would seem to be classic section 274 scenarios, but the
documentation is patently insufficient to validate any
deductions.
G. Gifts, Awards, or Cash
In the course of the multilevel marketing enterprise,
petitioners through Mayor and KareMor gave away, principally to
distributors, substantial quantities of cash and merchandise.
These items were generally intended to serve a motivational
purpose, generating incentive and excitement. In some instances,
random cash awards presumably served an additional purpose of
encouraging distributors to attend business program
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