- 5 -
was that she is entitled to the deduction at issue because she
claimed the expenses “as a lay person [would]”.
Discussion
Deductions are a matter of legislative grace, and the
taxpayer bears the burden of proving that he or she is entitled
to any deduction claimed. Rule 142(a); New Colonial Ice Co. v.
Helvering, 292 U.S. 435, 440 (1934); see INDOPCO, Inc. v.
Commissioner, 503 U.S. 79, 84 (1992). This includes the burden
of substantiation. Hradesky v. Commissioner, 65 T.C. 87, 90
(1975), affd. per curiam 540 F.2d 821 (5th Cir. 1976); cf. sec.
7491(a) (which does not effect any burden shifting given
petitioner’s failure to: (1) Raise the matter and (2) comply
with all requirements of section 7491(a)(2)).
Section 162 allows a deduction for ordinary and necessary
business expenses paid or incurred during the taxable year in
carrying on a trade or business. Sec. 162(a); Deputy v. du Pont,
308 U.S. 488, 495 (1940). A trade or business includes the trade
or business of being an employee. O’Malley v. Commissioner, 91
T.C. 352, 363-364 (1988). The taxpayer bears the burden of
substantiation. Hradesky v. Commissioner, supra at 90.
Section 6001 provides, in pertinent part, as follows:
SEC. 6001. NOTICE OR REGULATIONS REQUIRING RECORDS,
STATEMENTS, AND SPECIAL RETURNS.
Every person liable for any tax imposed by this
title [title 26, Internal Revenue Code of 1986], or
for the collection thereof, shall keep such records,
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