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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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