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Respondent also argues that petitioners have failed to
substantiate petitioner’s expenses related to his trips to union
halls in 2002. Petitioners claimed deductions at per diem rates
for 16 days in Honolulu and 12 days in San Francisco. Although
the per diem rates serve as an alternative method of
substantiating the amount of expenses, petitioners must still
substantiate the time, place, and business purpose of the
underlying trip to deduct the per diem rates as ordinary and
necessary business expenses. Sec. 274(d)(1); sec. 1.274-5T(b),
Temporary Income Tax Regs., 50 Fed. Reg. 46014 (Nov. 6, 1985).
Petitioner testified that the expenses related to his trips
to the union halls to seek employment are accurately represented
by credit card statements that petitioners presented as evidence
at trial. The credit card statements, which include an array of
expenditures including personal expenses, show that petitioner
was present in San Francisco approximately 11 days in March and
incurred expenses there for lodging and meals. Petitioner
asserts, and we believe, that he traveled to the San Francisco
area union hall in March 2002 in search of a job, but it appears
that he was unable to secure a job at that time. Petitioner
incurred ordinary and necessary business expenses related to his
trip to San Francisco in March 2002 and may deduct his expenses
for lodging, meals, and incidental expenses at the applicable per
diem rates for those 11 days.
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