Michael W. Allen - Page 10

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          INDOPCO, Inc. v. Commissioner, 503 U.S. 79, 84 (1992); Welch v.             
          Helvering, 290 U.S. 111, 115 (1933).                                        
               Second, deductions are a matter of legislative grace, and              
          the taxpayer must show that he or she is entitled to any                    
          deduction claimed.  Rule 142(a); Deputy v. duPont, 308 U.S. 488,            
          493 (1940); New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440            
          (1934); Welch v. Helvering, supra.  This includes the burden of             
          substantiation.  Hradesky v. Commissioner, 65 T.C. 87, 90 (1975),           
          affd. per curiam 540 F.2d 821 (5th Cir. 1976).                              
               A taxpayer must substantiate amounts claimed as deductions             
          by maintaining the records necessary to establish he or she is              
          entitled to the deductions.  Sec. 6001; Hradesky v. Commissioner,           
          supra.  A taxpayer shall keep such permanent records or books of            
          account as are sufficient to establish the amount of deductions             
          claimed on the return.  Sec. 6001; sec. 1.6001-1(a), (e), Income            
          Tax Regs.  The Court need not accept a taxpayer’s self-serving              
          testimony when the taxpayer fails to present corroborative                  
          evidence.  Beam v. Commissioner, T.C. Memo. 1990-304 (citing                
          Tokarski v. Commissioner, 87 T.C. 74,77 (1986)), affd. without              
          published opinion 956 F.2d 1166 (9th Cir. 1992).                            
               If a taxpayer establishes that he or she paid or incurred a            
          deductible business expense but does not establish the amount of            
          the deduction, this Court may approximate the amount of the                 
          allowable deduction, bearing heavily against the taxpayer whose             


               7(...continued)                                                        
          with petitioner.                                                            




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