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lack of substantiation. Although petitioner substantiated $1,514
for insurance, $3,027 for repairs and maintenance expenses, and
$898 for utilities, respondent disallowed those expenses as
personal in nature.
In the notice of deficiency respondent determined that
petitioner is entitled to deduct $2,010 as real estate taxes,
$12,740 as mortgage interest, and $400 as a charitable
contribution deduction on Schedule A, Itemized Deductions.
Discussion
Section 162(a) allows a taxpayer to deduct all ordinary and
necessary expenses paid or incurred in carrying on a trade or
business. Under section 280A, however, deductions associated
with a home office are generally disallowed unless the home
office is used exclusively and regularly as the principal place
of business of the taxpayer.4
Petitioner presented no evidence to substantiate deductions
claimed for advertising expenses, car and truck expenses,
legal/professional expenses, and other expenses which consisted
of postal and shipping, business calls and faxes, and computer
and software services claimed on Schedule C. Secs. 162, 274(d),
280F(d)(4). Respondent’s determination as to these adjustments
is sustained.
4 Petitioner does not argue, nor does the record establish,
that petitioner satisfied the requirements of sec. 7491(a).
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Last modified: March 27, 2008