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substantiate some of the expenses claimed on her 2002 Schedule C.
These documents included an alleged customer list, a receipt for
a purchased laptop computer, a canceled check for prepaid legal
services, receipts for supplies totaling $21.38, a canceled check
for postage, invoices for the alleged rental of a postage
machine, and phone bills.4
Altogether, petitioner’s documentation fell woefully short
of demonstrating that she was involved in a trade or business and
represented only a fraction of the expenses petitioner attempted
to deduct on her return. Petitioner testified that she had more
records when she prepared her 2002 return than the records she
provided to respondent or the Court, but that they had been lost
or removed from her computer files. Petitioner also stated that
the only business she did in 2002 relating to event planning was
a Crab Feast Safety Tour, for which she provided documentation
indicating that the tour had been canceled, and that she could
not get any more bookings that year.
Evidence of one canceled event, along with a sampling of
receipts, canceled checks, and invoices, is insufficient to show
that petitioner was continuously and regularly involved in the
trade or business of event planning for the primary purpose of
4 Petitioner testified that she kept receipts, but that her
son had thrown away many of her receipts by mistake when she
replaced some flooring in her house where the records were kept.
Petitioner also testified that she kept a notebook in which she
recorded expenses, but that she had thrown it away by mistake.
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Last modified: November 10, 2007