Income Tax Issues
Books and Records

Chancellor v. Commissioner
T.C. Memo. 2021-50

On May 4, 2021, the Tax Court issued a Memorandum Opinion in the case of Chancellor v. Commissioner (T.C. Memo. 2021-50). The primary issue presented in Chancellor v. Commissioner was whether the IRS erred in disallowing deductions the petitioner claimed for certain business expenses, charitable contributions, and state and local tax. Brief Background to Chancellor v. Commissioner Ms. Viola Chancellor, of Nevada, is a notary and a paralegal.  In 2015, she received $400 from her

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Scott St. Amand May 4, 2021
Income Tax Issues
Books and Records

The Cohan Rule and the IRC § 274 Exception

A taxpayer may deduct all ordinary and necessary expenses paid or incurred during the taxable year in carrying on a trade or business.[1] In contrast, a taxpayer may not deduct personal, living, or family expenses unless the Code expressly provides otherwise.[2] The determination of whether an expense satisfies the requirements of IRC § 162 is a question of fact for the Tax Court.[3] Proving Entitlement A taxpayer must prove his entitlement to all deductions and

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Scott St. Amand April 29, 2021
Income Tax Issues
IRC § 162

Brashear v. Commissioner
T.C. Memo. 2020-122

On August 19, 2020, the Tax Court issued a Memorandum Opinion in the case of Brashear v. Commissioner (T.C. Memo. 2020-122). The primary issue before the court in Brashear was whether the petitioners were entitled to various deductions on Schedule C (Profits and Loss from Business). Business-Related Deductions 101 in Brashear v. Commissioner The taxpayer’s burden of proof regarding entitlement to deductions requires the taxpayer to substantiate all expenses underlying the deductions claimed by keeping

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Scott St. Amand August 19, 2020
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Chancellor v. Commissioner
T.C. Memo. 2021-50

On May 4, 2021, the Tax Court issued a Memorandum Opinion in the case of Chancellor v. Commissioner (T.C. Memo. 2021-50). The primary issue presented in Chancellor v. Commissioner was whether the IRS erred in disallowing deductions the petitioner claimed for certain business expenses, charitable contributions, and state and local

Read More »
Scott St. Amand May 4, 2021

The Cohan Rule and the IRC § 274 Exception

A taxpayer may deduct all ordinary and necessary expenses paid or incurred during the taxable year in carrying on a trade or business.[1] In contrast, a taxpayer may not deduct personal, living, or family expenses unless the Code expressly provides otherwise.[2] The determination of whether an expense satisfies the requirements

Read More »
Scott St. Amand April 29, 2021

Brashear v. Commissioner
T.C. Memo. 2020-122

On August 19, 2020, the Tax Court issued a Memorandum Opinion in the case of Brashear v. Commissioner (T.C. Memo. 2020-122). The primary issue before the court in Brashear was whether the petitioners were entitled to various deductions on Schedule C (Profits and Loss from Business). Business-Related Deductions 101 in

Read More »
Scott St. Amand August 19, 2020