-38-
line that called for lease expense. The amount was
$7,476.
In reviewing workpapers, that amount should have
been classified as legal expense. It related to the
legal cost that Cathy Michelsen had incurred related to
a Tax Court proceeding dealing with taxable years 1993
through 1995 and paid to a law firm, the Joseph Mudd
Law Firm. Those proceedings related to Tax Court
Docket 14780-97.
The reference to “TR 225:17-227:14” is to Michelsen’s direct
testimony that she had a case in this Court in the “1999 time
frame” and had received a bill from an attorney named Joseph Mudd
for $7,632.75 of legal fees. We are unpersuaded that petitioners
are entitled to deduct for 1999 the $7,476 claimed for that year
as a lease (or, as they claim now, a legal) expense.
b. Travel
Petitioners argue that they have substantiated the $4,129 of
expenses claimed as a business travel deduction through the
introduction of Exhibit 123-P and the testimony of Michelsen.
That evidence, petitioners conclude, proves that they traveled to
Australia to attend the Sydney gift show, to search for a
location in Australia to open a fourth Nature’s Touch store, and
to identify merchandise to import into the United States. We
disagree that petitioners are entitled to any of their reported
travel expenses for 1999. Petitioners have simply not persuaded
us that their trip to Australia was related primarily to
Michelsen’s reported work for her sole proprietorship during 1999
as a “Corporate Director/Consultant”. Nor have petitioners
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