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Petitioner’s investment activities do not constitute a trade
or business. Petitioner has failed to show that the traveling
expenses are related to the production of income or the
conservation of property held for the production of income. The
Court finds that petitioner’s trips were personal in nature.
Under section 262, petitioner’s deduction for traveling expenses
is disallowed.
2. Meals and Entertainment
For 2000, petitioner claimed deductions of $4093 for meals
and entertainment expenses. Petitioner produced a spreadsheet
that summarily listed the date, the amount of the meal, the miles
traveled, the name of the “client”, and the alleged business
purpose of each meal. The alleged business purpose was described
broadly, such as “bank investment”, “mortgages”, “real estate
investment”, and “bond market”. None of the alleged business
purposes related to petitioner’s personal investment management.
The Court has already found that petitioner did not carry on
a trade or business. Therefore, petitioner must show that the
meals are sufficiently related to the production of income or the
conservation of property held for the production of income in
connection with his personal investment management. Petitioner
3At trial, petitioner testified that he claimed $219 for
meals and entertainment expenses incurred during the trips. It
is unclear as to which activity the remaining expenses relate.
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Last modified: May 25, 2011