Michael and Penny Rhodes - Page 10

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          or telephone number for the Silk Shop either to the examiner or             
          at trial.  The examiner investigated her claim and found that               
          there had never been a business called the Silk Shop in or around           
          Coldwater, Michigan, and neither the Chamber of Commerce nor the            
          County Clerk’s office had any record of a store by that name.               
          Furthermore, respondent offered evidence at trial from area                 
          telephone books and city directories for the years 1993, 1994,              
          and 1995; none had a listing for a Silk Shop in or around                   
          Coldwater, Michigan.                                                        
               The Court finds that Ms. Rhodes at no time purchased items,            
          either retail or wholesale, from Frank’s, the Silk Shop, or any             
          other store.  Moreover, the Court also finds that Ms. Rhodes did            
          not purchase items “off the back of a truck” from someone who she           
          “believed worked for Frank’s”.  The Court finds that the                    
          transactions never occurred.                                                
               On their Schedules C for Keepsake, petitioners deducted car            
          and truck expenses of $10,035.16 and $3,772.80 for 1994 and 1995,           
          respectively.  With respect to travel expenses and certain other            
          expenses, such as expenses relating to the use of listed                    
          properties under section 280F(d)(4)(A), including passenger                 
          automobiles and any other property used as a means of                       
          transportation, section 274(d) imposes stringent substantiation             
          requirements to document particularly the nature and amount of              
          such expenses.  For such expenses, substantiation of the amounts            

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