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groceries, for 1991-94 by issuing checks from account No.
893315300.
There are seven general categories of additional disputed
expenses that were paid out of account No. 893315300 which we
will discuss: (1) Advertising or promotional expenses; (2)
professional fees; (3) travel expenses; (4) automobile and truck
expenses; (5) office supplies and general supplies; (6) utility
expenses; and (7) miscellaneous expenses.
1. Advertising or Promotional Expenses
Expenses for the promotion or sponsorship of activities not
directly related to a taxpayer’s business are deductible if the
taxpayer can establish a proximate relationship between the
activity and the taxpayer’s business such that the sponsorship
was reasonably calculated to advertise the business. Gill v.
Commissioner, T.C. Memo. 1994-92, affd. without published opinion
76 F.3d 378 (6th Cir. 1996).
SCC advertised its business primarily either through word of
mouth or by athletic sponsorships. As part of the athletic
sponsorships, SCC paid for the uniforms, logo design, hats, t-
shirts, sweat pants, coats, bags, and pants for all players on
its sponsored teams. In addition, SCC made monetary donations
for high school wrestling organizations and would provide
equipment and league/tournament fees for its sponsored athletic
teams.
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