Tax Court disallowed the deductibility of a minister’s travel and transportation expenses

The Tax Court disallowed the deductibility of a minister's travel and transportation expenses because of a lack of substantiation.

The court observed that section 274(d) of the Internal Revenue Code specifies that travel and transportation expenses (including meals and lodging while away from home overnight) are not deductible unless a taxpayer substantiates by adequate records the amount of such expenses, the time and place of the travel, and the business purpose of the expenses.

In this case, the minister's receipts and records failed to substantiate all of these elements. For example, some receipts were for "oil and gas," but there was no proof that the oil and gas were used for business purposes.

The court acknowledged that the minister doubtless had been reimbursed by his church for some legitimate travel and transportation expenses that actually had been incurred. However, such expenses were not deductible as an "above the line" adjustment to gross income on Form 1040 since the taxpayer could not adequately substantiate the business nature, date, and amount of such expenses.

The court refused to sift through the taxpayer's exhibits and schedules ("which may be stacked to a height of nearly five feet") for evidence of substantiation and deductibility, since "the Tax Court should not be asked to ferret out the correct answer to technical or difficult questions of law and fact from unexplained, uncoordinated evidence." Sly v. Commissioner, 56 T.C.M. 209 (1988).

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