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mileage for the automobiles. The deductions claimed for clothes
and food were for everyday clothing and meals which are clearly
personal expenses. The claimed utility expense deductions were
for the total utilities for his home and clearly have more than
an incidental personal portion in the amount claimed.5 Even
putting aside the failure to comply with section 274(d), there is
no evidence as to the business nature of the claimed travel and
lodging expenses. Petitioner’s testimony concerning the travel
expenses indicates that members of his family traveled with him.
The insurance, other than that allowed by respondent, consisted
of personal life insurance and automobile insurance. In sum, we
find no basis for the amount of the deductions claimed.
B. Section 6662 Penalties
Section 6662(a) provides a penalty in an amount equal to 20
percent of the portion of any underpayment attributable to, among
other things, “Negligence or disregard of rules or regulations”.
Sec. 6662(b)(1). “‘Negligence’ includes any failure to make a
reasonable attempt to comply with the provisions * * * [of the
Internal Revenue Code], and the term ‘disregard’ includes any
careless, reckless, or intentional disregard.” Sec. 6662(c).
Negligence also includes any failure by the taxpayer to keep
5 Respondent allowed a portion of the utilities and
homeowners insurance based on petitioner’s use of a portion of
his home for business purposes.
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Last modified: May 25, 2011