Michael L. and Ann Burski - Page 9




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          performed by an employee constitute a trade or business for                 
          purposes of section 162(a).4  O’Malley v. Commissioner, 91 T.C.             
          352, 363-364 (1988).                                                        
               In general, expenses incurred for a taxpayer’s daily meals             
          and lodging and for commuting between the taxpayer’s residence              
          and the taxpayer’s place of business are nondeductible personal             
          expenses.  Sec. 262(a); see, e.g., United States v. Correll, 389            
          U.S. 299 (1967); Commissioner v. Flowers, 326 U.S. 465, 472-473             
          (1946); Barry v. Commissioner, 54 T.C. 1210, 1214 (1970), affd.             
          per curiam 435 F.2d 1290 (1st Cir. 1970); see also secs.                    
          1.162-2(e), 1.262-1(b)(5), Income Tax Regs.  By contrast,                   
          traveling expenses, including amounts expended for meals and                
          lodging, may be deducted if they are incurred while away from               
          home5 in the pursuit of a trade or business.  Secs. 162(a)(2),              
          262.  To deduct a travel expense, the taxpayer must show that (1)           
          he or she was away from home when he or she incurred the expense,           
          (2) the expense is reasonable and necessary, and (3) the expense            
          was incurred in pursuit of a trade or business.  Commissioner v.            
          Flowers, supra at 470.                                                      


               4An employee is allowed to deduct unreimbursed employee                
          expenses as miscellaneous itemized deductions on Schedule A,                
          subject to the 2-percent limitation under sec. 67.                          
               5For a taxpayer to be considered “away from home” within the           
          meaning of sec. 162(a)(2), the taxpayer must be on a trip that              
          requires the taxpayer to stop for sleep or a substantial period             
          of rest.  United States v. Correll, 389 U.S. 299 (1967);                    
          Strohmaier v. Commissioner, 113 T.C. 106, 115 (1999).                       





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