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145, 153 (1928).” O’Malley v. Commissioner, 91 T.C. 352, 361-362
(1988). In determining whether such expenses are deductible, we
must focus on “the origin and character of the claim with respect
to which [the] expense was incurred”. United States v. Gilmore,
supra at 49.
In support of his position that he is entitled to deduct in
the 1999 Schedule C the $5,000 claimed legal expense, petitioner
testified:
It was in the process of building up my business. I
was in computer consulting, computer software, and it
was computer equipment that I had tried to purchase at
a slight discount.
Petitioner did not present any other evidence in support of his
position with respect to the $5,000 claimed legal expense.
On the instant record, we find that petitioner has failed to
carry his burden of establishing that the criminal proceeding in
which Mr. Christie represented petitioner arose in connection
with or proximately resulted from a business or profit-seeking
activity of petitioner. On that record, we further find that
petitioner has failed to carry his burden of establishing that
the origin and the character of the claim with respect to which
the $5,000 claimed legal expense was incurred was a business or
profit-seeking activity of petitioner.
On the record before us, we find that petitioner has failed
to carry his burden of establishing that he is entitled to deduct
in the 1999 Schedule C the $5,000 claimed legal expense.
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