Curtis Muhammad - Page 10

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          payroll services, his payments to his only purported employee               
          would not necessitate such services.                                        
               Other than the BMS receipts, petitioner failed to produce              
          any substantiation that he actually made payments to his father-            
          in-law or BMS or that the purported payments actually related to            
          a trade or business.  Given the relationship between petitioner             
          and the people who operated BMS, the fact that the payments were            
          allegedly made in cash, and the fact that the receipts indicate             
          that they were for payroll work that would seem unnecessary, we             
          find that petitioner has failed to meet his burden of proof.                
          Respondent’s determination disallowing petitioner’s claimed legal           
          and professional expense deductions is sustained.                           
               2.   Rental Expenses                                                   
               Respondent argues that petitioner failed to substantiate the           
          $2,400 rental equipment expense deduction because the invoices              
          submitted by petitioner lack credibility and are generally                  
          untrustworthy.  To substantiate his rental expenses, petitioner             
          submitted five invoices from CB Associates indicating that he               
          leased a laptop computer for $3,600 and a printer for $2,400 from           
          January 7 to December 7, 2002, at monthly rates of $300 and $200            
          for the computer and printer, respectively.6  Craig Brown,                  

               6 The invoice dates and amounts purportedly paid in 2002 are           
          as follows:  January 7-$500; April 7-$1,500; August 7-$2,000;               
          November 7-$1,500; December 7-$500.  The return address for CB              
          Associates on the invoices was incorrect because it had the wrong           
                                                             (continued...)           





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