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sought to be deducted. Sec. 1.274-5T(c)(1), Temporary Income Tax
Regs., 50 Fed. Reg. 46016 (Nov. 6, 1985).
At trial, petitioner presented no documentary evidence to
substantiate the claimed expenses. He testified that these
expenses related to his employment with Marco’s Auto Body and in
the startup of his self-employed activity. Petitioner, however,
could not recall what some of the expenses were about. The Court
accordingly sustains respondent on this issue.
The third issue is respondent’s disallowance of $12,000 in
rent claimed as an expense on Schedule C relating to petitioner’s
self-employed activity. Petitioner’s auto repair business,
Gregorian’s Automotive, was conducted in a separate facility he
rented that was located approximately 12 miles away from the
location of his employment with Royal Coach, Inc. He testified
that he leased the building and paid $1,000 per month for rent.
Petitioner presented no documentation, such as canceled checks or
receipts to substantiate the $12,000. The Court notes from the
evidence that there was some degree of strain between petitioner
and Royal Coach, Inc., regarding the private work of petitioner
at Royal Coach’s place of business. To relieve that pressure,
petitioner rented the separate facility for the purpose of
operating his self-employment activity. The Court accepts that
testimony but is not prepared to allow petitioner the deduction
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