1 Unless otherwise indicated, all subsequent section

references are to the Internal Revenue Code in effect for 2005,

the taxable year in issue, and all Rule references are to the Tax

Court Rules of Practice and Procedure.

T.C. Summary Opinion 2010-131

UNITED STATES TAX COURT

TONI MARIE OGNIBENE, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 24828-08S. Filed September 7, 2010.

Toni Marie Ognibene, pro se.

Nicholas Doukas, for respondent.

ARMEN, Special Trial Judge: This case was heard pursuant to

the provisions of section 7463 of the Internal Revenue Code in

effect when the petition was filed.1 Pursuant to section

7463(b), the decision to be entered is not reviewable by any 
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2 As further described by petitioner: “My responsibilities

was [sic]--it was coordination and fixing of paperless claims

through Blue Cross/Blue Shield.”

other court, and this opinion shall not be treated as precedent

for any other case.

Respondent determined a deficiency in petitioner’s 2005

Federal income tax of $2,961.

The issue for decision is whether petitioner is entitled to

various Schedule A and Schedule C deductions that respondent

disallowed for lack of substantiation. We hold that she is not.

Background

The parties stipulated only to venue and to copies of

petitioner’s 2005 Federal income tax return and respondent’s

notice of deficiency. The fact stipulated is so found, and we

incorporate by reference the parties’ stipulation of facts and

its two accompanying exhibits.

Petitioner resided in the State of California when the

petition was filed.

During 2005, the taxable year in issue, petitioner lived in

Los Angeles, California, and worked downtown, presumably on a

full-time basis, for Ancillary Care Management, Inc. (Ancillary

Care), “doing third-party health care coordination”.2

In addition to her employment, petitioner engaged in “mobile

tutoring”, which petitioner described as “a tutoring business,

for ages kindergarten through senior year of high school,
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teaching anything from reading to SATs.” As a “mobile tutor”,

petitioner traveled between Los Angeles, where she had

“approximately” two students, and Fresno, where she had

“approximately” three students. “I would drive back and forth,

which is about 317 miles one way, tutoring students from SATs to

reading.” Petitioner drove between Los Angeles and Fresno

“nearly every weekend” using her only personal vehicle, a Ford

Explorer SUV, which “takes a great deal of fuel.”

Petitioner tutored “for 1 hour at a time” but did not always

get paid because, as petitioner explained: “there were times

where the client couldn’t pay, where the parents were just unable

to.” Petitioner’s fee “per session was about $15, $10,

averaging”.

During 2005, petitioner maintained a checking account, and

she regularly used a debit card “so all transactions are logged.” 

Petitioner filed a Federal income tax return for 2005. On

her return, petitioner listed her occupation as “finance”, and

she reported negative taxable income, which was occasioned

principally by itemized deductions of $22,000 claimed on a

Schedule A, Itemized Deductions, and a net loss of $18,149

claimed on a Schedule C, Profit or Loss From Business.

On her Schedule A, petitioner claimed the following

deductions:
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Medical/Dental $ 3,539

less: 71⁄2% AGI - 1,002 $ 2,537

Taxes 1,163

Charity 

cash or check 4,372

property 350

carryover from prior year 462 5,184 

Job Expenses & Tax Prep fees

employee expenses 13,303

tax preparation fees 80

 13,383

less: 2% AGI -267 13,116

Total Itemized Deductions $22,000

 

In support of the $13,303 deduction claimed for job

expenses, petitioner attached to her return a Form 2106, Employee

Business Expenses. On that form, petitioner claimed the

following:

Vehicle expense $ 7,838

Other business expenses 5,228

Meals/entertainment

total $474

less: 50% -237 237

Total $13,303

Petitioner claimed a vehicle expense of $7,838 based on

“actual expenses”, which petitioner computed as follows:

Gasoline, oil repairs

insurance, etc. $7,801

x business use percentage x 81.850%

 6,385

+ depreciation 1,453

Total $7,838

Petitioner computed the business use percentage of 81.85 as

follows:

Total miles driven in 2005 50,298

less: commuting miles -4,025

 other nonbusiness miles -5,106

Business miles 41,167
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Percentage of business use:

 41,167mi. ÷ 50,298mi. 81.850%

Petitioner computed depreciation based on a vehicle cost of

$29,995 and a vehicle placed-in-service date of May 23, 2002.

Petitioner attached to her return a Form 4562, Depreciation

and Amortization, regarding the aforementioned depreciation

deduction of $1,453, as well as a second depreciation deduction

of $558 that was apparently subsumed in the category of “Other

business expenses” on the Form 2106. The Form 4562 reflected the

following:

 Business Use Depreciation

Property Service date Percentage Cost Basis Deduction 

Ford Explorer May 23, 2002 81.850 $29,995 $1,453

Dell computer Jan 01, 2004 70.000 3,560 558

 $2,011

On her Schedule C for her “mobile tutoring business”,

petitioner reported gross receipts of $445 and claimed total

expenses of $18,594, for a net loss of $18,149. Chief among the

claimed expenses were the following two:

Car and truck expenses $14,368

Depreciation 2,654

Petitioner did not complete Part IV of Schedule C regarding

“Information on Your Vehicle” in support of the deduction for car

and truck expenses of $14,368. But in support of the

depreciation deduction of $2,654, petitioner attached to her

return a second Form 4562, Depreciation and Amortization,

reporting the following:
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 Business Use Depreciation

Property Service date Percentage Cost Basis Deduction 

Ford Explorer May 23, 2002 91.610 $29,995 $1,626

Dell computer Jan 01, 2004 100.000 3,560 1,028

 $2,654

In the notice of deficiency, respondent disallowed, for lack

of substantiation, deductions claimed by petitioner on Schedule A

for medical and dental expenses, charitable contributions, and

employee business expenses. Respondent did not specifically

disallow the deduction claimed for taxes paid; however, that

deduction was less than the standard deduction, so respondent

allowed the latter instead as it was more advantageous to

petitioner. See sec. 63(c). Respondent appears to have

disallowed the deduction claimed for tax prep fees only because

it did not exceed 2 percent of petitioner’s adjusted gross

income. See sec. 67(a).

Also in the notice of deficiency, respondent disallowed, for

lack of substantiation, deductions claimed by petitioner on

Schedule C for car and truck expenses and depreciation.

Discussion

Burden of Proof

Generally, the Commissioner’s determinations are presumed

correct, and the taxpayer bears the burden of proving that those

determinations are erroneous. Rule 142(a); INDOPCO, Inc. v.

Commissioner, 503 U.S. 79, 84 (1992); Welch v. Helvering, 290

U.S. 111, 115 (1933). Specifically, deductions are a matter of
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legislative grace, and the taxpayer bears the burden of proving

entitlement to any deduction claimed. Rule 142(a); Deputy v. du

Pont, 308 U.S. 488, 493 (1940); New Colonial Ice Co. v.

Helvering, 292 U.S. 435, 440 (1934). Although section 7491(a)

may serve to shift the burden of proof to the Commissioner under

certain circumstances, it does not do so here for at least three

reasons: Petitioner failed to raise the matter; petitioner

failed to comply with substantiation requirements and to

cooperate with reasonable requests by respondent, see sec.

7491(a)(2)(A) and (B); and petitioner failed to introduce

credible evidence, see sec. 7491(a)(1). Accordingly, petitioner

bears the burden of proof.

Principles Governing Substantiation

Contrary to petitioner’s apparent view, the fact that a

taxpayer reports a deduction on the taxpayer’s income tax return

and attaches some IRS-prescribed form in support of that

deduction is not sufficient to substantiate the deduction claimed

on the return. Wilkinson v. Commissioner, 71 T.C. 633, 639

(1979); Roberts v. Commissioner, 62 T.C. 834, 837 (1974). A tax

return is merely a statement of the taxpayer’s claim; the return

is not presumed to be correct. Wilkinson v. Commissioner, supra

at 639; Roberts v. Commissioner, supra at 837; see also Seaboard

Commercial Corp. v. Commissioner, 28 T.C. 1034, 1051 (1957) (a

taxpayer’s income tax return is a self-serving declaration that
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may not be accepted as proof for the deduction or exclusion

claimed by the taxpayer); Halle v. Commissioner, 7 T.C. 245

(1946) (a taxpayer’s return is not self-proving as to the truth

of its contents), affd. 175 F.2d 500 (2d Cir. 1949). 

A taxpayer is required to maintain records sufficient to

substantiate deductions claimed by the taxpayer on his or her

return. See generally sec. 6001 (“Every person liable for any

tax imposed by this title, or for the collection thereof, shall

keep such records * * * and comply with such rules and

regulations as the Secretary may from time to time prescribe.”);

sec. 1.6001-1(a), Income Tax Regs. (“Any person subject to tax *

* * shall keep such permanent books of account or records * * *

as are sufficient to establish the amount of * * * deductions.”);

sec. 1.6001-1(e), Income Tax Regs. (“The books or records

required by this section shall be kept at all times available for

inspection by authorized internal revenue officers or employees,

and shall be retained so long as the contents thereof may become

material in the administration of any internal revenue law.”). 

As a general rule, if, in the absence of such records, a

taxpayer provides sufficient evidence that the taxpayer has

incurred a deductible expense, but the taxpayer is unable to

adequately substantiate the amount of the deduction to which he

or she is otherwise entitled, the Court may estimate the amount

of such expense and allow the deduction to that extent. Cohan v.
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3 Sec. 274(d) provides in pertinent part as follows:

SEC. 274. Disallowance of Certain Entertainment, Etc. Expenses.

(d) Substantiation required.-–No deduction or credit shall

be allowed--

(1) * * * for any traveling expense (including meals

and lodging while away from home,

(2) for any item with respect to an activity which is

of a type generally considered to constitute entertainment,

amusement, or recreation, * * *

(continued...)

Commissioner, 39 F.2d 540, 543-544 (2d Cir. 1930). However, in

order for the Court to estimate the amount of an expense, we must

have some basis upon which an estimate may be made. Vanicek v.

Commissioner, 85 T.C. 731, 743 (1985). Without such a basis, any

allowance would amount to unguided largesse. Williams v. United

States, 245 F.2d 559, 560 (5th Cir. 1957).

However, in the case of certain expenses, section 274(d)

overrides the so-called Cohan doctrine. Sanford v. Commissioner,

50 T.C. 823, 827 (1968), affd. per curiam 412 F.2d 201 (2d Cir.

1969); sec. 1.274-5T(a), Temporary Income Tax Regs., 50 Fed. Reg.

46014 (Nov. 6, 1985). Specifically, and as pertinent herein,

section 274(d) provides that no deduction is allowable for

traveling expenses (including meals and lodging while away from

home) or entertainment expenses or with respect to listed

property as defined in section 280F(d)(4), unless the deduction

is substantiated in accordance with the strict substantiation

requirements of section 274(d) and the regulations promulgated

thereunder.3 Included within the definition of listed property
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3(...continued)

(3) for any expense for gifts, or

(4) with respect to any listed property (as defined in

section 280F(d)(4)),

unless the taxpayer substantiates by adequate records or by

sufficient evidence corroborating the taxpayer's own statement

(A) the amount of such expense or other item, (B) the time and

place of the travel, entertainment, amusement, recreation, or use

of the facility or property, or the date and description of the

gift, (C) the business purpose of the expense or other item, and

(D) the business relationship to the taxpayer of persons

entertained, using the facility or property, or receiving the

gift * * *.

in section 280F(d)(4) is any passenger automobile or other

property used as a means of transportation and any computer. 

Sec. 280F(d)(4)(A)(i), (ii), (iv), (5); sec. 1.280F-6(b) and (c),

Income Tax Regs.

Thus, under section 274(d), no deduction is allowable for

expenses incurred in respect of listed property on the basis of

any approximation or the unsupported testimony of the taxpayer. 

See, e.g., Murata v. Commissioner, T.C. Memo. 1996-321; Golden v.

Commissioner, T.C. Memo. 1993-602. In other words, in the

absence of adequate records or sufficient evidence corroborating

the taxpayer’s own statement, any deduction that is subject to

the stringent substantiation requirements of section 274(d) is

proscribed.
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Analysis

Schedule A Deduction for Medical and Dental Expenses

Petitioner introduced no documentary evidence whatsoever

regarding the claimed deduction. The sum total of petitioner’s

testimonial evidence on this issue was as follows:

PETITIONER: The medical and dental expenses were

-- I paid cash for my -- they are for copay visits, as

well as the cost of lingual braces, which was $10,000,

as well as the cost for the regular visits. I go to a

psychiatrist, as well as pay for my medication out of

cash. My insurance premiums were extremely high that

year. So all my medical expenses are paid from cash

out of -- per my employer. 

* * * * * * *

THE COURT: * * * So the medical providers would

take a debit card?

PETITIONER: Yes. * * * And their charts upon --

indicated for a copay -- so a dermatologist,

ophthalmologist for contact lenses, psychiatrist,

orthodontist, dentist, and dermatologist, a second

dermatologist, a surgeon. * * * All specialists. * * *

And the deduction indicates the cost for copay, the

cost of prescriptions, the cost of optical lenses, the

cost of lingual braces, extractions, cleanings, for

each of those, which are -- which are indicated on --

in my checking -- checking account statements, which

can be substantiated.

As previously stated, petitioner did not introduce her

checking account statements, or any other documentary evidence,

in support of the claimed deduction. Although we are willing to

accept petitioner’s testimony that copays were incurred in

consulting with specialists, there is no support in the record

for a finding that allowable medical and dental expenses exceed
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4 Substantiation requirements for 2005 that are

specifically applicable to deductions of charitable contributions

are succinctly summarized in Freedman v. Commissioner, T.C. Memo.

2010-155, as follows:

A taxpayer claiming a charitable contribution of money

is generally required to maintain for each contribution

a canceled check, a receipt from the donee charitable

organization showing the name of the organization and

the date and amount of the contribution, or other

reliable written records showing the name of the donee,

the date, and amount of the contribution. Sec. 1.170A13(a)(1), Income Tax Regs. Factors that indicate

reliability include, but are not limited to, the

contemporaneous nature of the writing, the regularity

of the taxpayer’s recordkeeping procedures, and the

existence of any other evidence from the donee

charitable organization evidencing receipt. Sec.

1.170A-13(a)(2), Income Tax Regs. In addition, no

deduction is allowed, for any contribution of $250 or

more unless the taxpayer substantiates the contribution

by a contemporaneous written acknowledgment by a

qualified donee organization. Sec. 170(f)(8)(A).

[Fn. ref. omitted.]

the statutory threshold of 7.5 percent of adjusted gross income

as required by section 213(a). See Williams v. United States,

supra at 560; Vanicek v. Commissioner, supra at 743. 

Respondent’s disallowance determination is therefore sustained.

Schedule A Deduction for Charitable Contributions

Petitioner introduced no documentary evidence whatsoever

regarding the claimed deduction.4 And petitioner did not even

testify regarding the “carryover from prior year”. Regarding

contributions in 2005, petitioner’s testimony was, at best, vague

regarding the beneficiaries of her largesse and specific amounts
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donated. The sum total of petitioner’s testimonial evidence on

this issue was as follows:

PETITIONER: Contributions were for -- were for

traveling back and forth to Team in Training, which was

a marathon. I worked with the local chapter. I do

have statements of just cash donations. The other cash

donations were in terms of paying for rides, working

with my Los Angeles Church, which was Valley

Presbyterian Church, working with a high school group. 

So the second organization that I worked with was

Valley Presbyterian. That was taking -- I worked with

a junior high group, mentoring them. So I -- the cost

of fuel and -- which can be substantiated with Well

Fargo checking accounts. 

As previously stated, petitioner did not introduce her Wells

Fargo checking accounts, or any other documentary evidence, in

support of the claimed deduction. Although we are willing to

accept petitioner’s testimony that she made charitable

contributions, there is no support in the record for a finding

that allowable contributions, in combination with other allowable

itemized deductions, exceed the standard deduction. See Williams

v. United States, 245 F.2d at 560; Vanicek v. Commissioner, 85

T.C. at 743. Respondent’s disallowance determination is

therefore sustained.

Schedule A Deduction for Employee Business Expenses

According to petitioner’s return, the $13,303 deduction for

employee business expenses consisted of vehicle expense of $7,838

and “other business expenses” of $5,228. Other than depreciation

of $558 on a Dell computer, the return does not identify the

other components of “other business expenses”. At trial,
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5 We infer from this testimony, as well as petitioner’s

Form W-2, Wage and Tax Statement, that the home office or

headquarters of petitioner’s employer, Ancillary Care, was

located in Minnesota.

6 “That same business” refers to the business of

petitioner’s employer, Ancillary Care.

7 At trial, a small spiral notebook was marked for

identification and moved by petitioner for admission into

evidence. Counsel for respondent objected on the grounds that

petitioner had not previously made such notebook available to the

examining agent, that after calendar call on the first day of the

trial session petitioner had declined to permit an Appeals

officer to review the notebook, and that on the morning of the

second day of the trial session petitioner had declined to meet

with the Appeals officer to go over the notebook and whatever

other records petitioner might have. After a prolonged voir dire

of the Appeals officer by both parties, the Court sustained

(continued...)

petitioner attempted to explain; the sum total of her testimony

in that regard was as follows:

PETITIONER: One of them is -- one of them was for

travel to Minnesota, which was -- which was for

business deductions.[5] They were travel back and forth

to several of our locations. We had to pay for parking

on our own without reimbursement, which was $170 --

which was -- I’m sorry -- $72 -- $72 a month to pay for

parking that was not reimbursed, the use of my own

computer, which was also included with that, and the

cost to furnish my own supplies for that same business,

as we ran out of money that year.[6]

Most of the claimed deduction for employee business expenses

is subject to the strict substantiation requirements of section

274(d) because the expenses relate to petitioner’s vehicle,

traveling expenses, or meals and entertainment. Suffice it to

say that the record includes no documentation substantiating such

expenses,7 and petitioner’s testimony is no substitute for such
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7(...continued)

counsel’s objection, and the notebook was not admitted into

evidence.

8 Because we hold that petitioner failed to satisfy the

strict substantiation requirements of sec. 274(d) and is

therefore not entitled to the deductions in issue on that basis,

we need not discuss the duplication of deductions most obviously

revealed in petitioner’s two Forms 4562.

documentation.8 Without the requisite documentation, no deduction

is allowable.

Regarding that part of the claimed deduction that might not

be subject to the strict substantiation requirements of section

274(d), suffice it to say that there is no support in the record

for a finding that allowable expenses exceed the statutory

threshold of 2 percent of adjusted gross income as required by

section 67(a) or, to the extent that such threshold might be

exceeded, that such excess, in combination with other allowable

itemized deductions, exceeds the standard deduction for the year. 

See Williams v. United States, supra at 560; Vanicek v.

Commissioner, supra at 743. 

In view of the foregoing, respondent’s disallowance

determination is sustained.

Schedule C Deductions

The claimed Schedule C deductions are subject to the strict

substantiation requirements of section 274(d) because they relate

to petitioner’s vehicle and computer, both of which are listed

property. Suffice it to say that the record includes no
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9 See supra notes 7 and 8.

documentation substantiating such expenses, and petitioner’s

testimony is no substitute for such documentation.9 Without the

requisite documentation, no deduction is allowable. Respondent’s

disallowance determination is therefore sustained.

Conclusion

Petitioner failed to prove that she is entitled to any of

the deductions in issue. Respondent’s deficiency determination

is therefore sustained.

To reflect the foregoing,

Decision will be entered

for respondent.