                   T.C. Summary Opinion 2009-5


                     UNITED STATES TAX COURT



                 STELLA A. DEVITO, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 5821-07S.             Filed January 7, 2009.



     Stella A. DeVito, pro se.

     Brooke S. Laurie, for respondent.



     PANUTHOS, Chief 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



     1
       Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the year in issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
                                - 2 -

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

precedent for any other case.

     Respondent determined a deficiency of $8,472 in petitioner’s

2003 Federal income tax and a $130.50 addition to tax for failure

to file the return on time.

     The issues for decision are whether petitioner is entitled

to itemized deductions in amounts greater than respondent allowed

and whether petitioner is liable for the addition to tax under

section 6651(a)(1).

                              Background

     Some of the facts have been stipulated, and we incorporate

the stipulation and accompanying exhibits by this reference.

Petitioner lived in California when she filed the petition.

     Petitioner worked full time as a nurse in 2003, purchased

new nursing uniforms, and paid to have her uniforms cleaned.

Petitioner traveled by train to nursing continuing education

conferences during 2003.   Before and after these conferences, she

investigated nursing employment opportunities in the cities where

the conferences were held.    Petitioner incurred expenses for

tuition, conference materials, train tickets and local

transportation, meals and lodging, telephone and computer use,

entertainment, and dry cleaning during these trips.    She also

paid to produce and/or duplicate her resume.
                               - 3 -

     Petitioner had several health problems in 2003, including

depression and chronic pain and fatigue.   One reason she

investigated employment opportunities in other cities was her

hope that relocating would improve her depression.   Petitioner

sought and received assistance for these ailments from her

church, the Christian Church of Religious Science, seeing church

“practitioners” 5 days each week throughout 2003 and paying $60

for each visit.

     There is no dispute that petitioner filed her 2003 Federal

income tax return late.   The Internal Revenue Service (IRS)

received the return on April 1, 2005.

     Petitioner claimed itemized deductions of $69,496 in 2003,

including:   (1) State and local taxes of $8,226; (2) home

mortgage interest of $20,189; (3) medical and dental expenses of

$21,715, of which she deducted $14,907 (the amount of her

expenses exceeding $6,808, the floor imposed by section 213(a));

(4) charitable contributions of $5,000 in cash and $500 in

property; and (5) miscellaneous itemized deductions of $22,489,

which included $55 for safe deposit box rental and $22,434 for

job-related expenses, and of which she deducted $20,674 (the

amount of her expenses exceeding $1,815, the floor imposed by

section 67(a)).

     The IRS sent petitioner a letter in May 2005 requesting

additional information in order to process her 2003 return.    The
                               - 4 -

IRS sought more information about petitioner’s claimed job-

related expenses.   After petitioner provided further details, the

IRS processed the return, made some adjustments, and issued a

refund for 2003 in an amount smaller than the refund petitioner

claimed.   At a later date petitioner’s 2003 return was selected

for examination.

     In May 2006 petitioner had an incident in her kitchen which

she described as a protein fire.   Although little or no damage

resulted from the fire itself, substantial cleanup was required

as a result of the smoke that permeated her house and the odor

and residue that coated her possessions.     Many of petitioner’s

records, including documents to support her itemized deductions

for 2003, were placed into plastic bags during the cleaning

process.

     In December 2006 the IRS issued a notice of deficiency,

allowing deductions totaling $28,415 for State and local taxes

and home mortgage interest and disallowing in full petitioner’s

claimed medical expense, charitable contribution, and

miscellaneous itemized deductions.     The IRS also determined a

$130.50 addition to tax for petitioner’s failure to file her 2003

return on time.

     At trial petitioner explained that her records must have

been discarded by the cleaning company because she was unable to

locate them during the IRS examination.     She asserted that the
                               - 5 -

fire and the actions of the cleanup crew were beyond her control

and that she should be allowed to reconstruct her records.

Petitioner’s reconstruction of her medical expenses at trial

indicated that she claimed the following:

              Expense description           Amount claimed

      Drugs, dental and eye care                $1,974
      Medical supplies                           2,967
      Domestic partner health insurance          1,174
      Mental health treatments                  15,600
        Total                                   21,715

Petitioner also testified that she had $2,866 withheld pretax in

2003 to pay for out-of-pocket health care costs.   The mental

health treatments petitioner claimed were provided by

practitioners in her church.

     Petitioner presented some vague testimony that her noncash

contributions were donations of clothes and small electronic

devices to a charity that cares for feral cats, that she received

blank acknowledgments for each donation, and that those receipts

were with her other records which must have been inadvertently

discarded.   Petitioner provided records showing cash donations of

$225 and $624 to charities in California.   She also claimed to

have donated $1,825 in cash during Alcoholics Anonymous (AA)

meetings in 2003 ($5 per day, 365 days in 2003) and $2,326 in

cash during services at the Christian Church of Religious Science

in 2003 (generally three services per week and $10-20 per

service).
                                - 6 -

     Petitioner’s reconstruction provided the following details

for the job-related expenses she claimed as miscellaneous

itemized deductions:2

            Job-related expense description      Amount claimed

         Continuing nursing education trips          $15,691
         Job search expenses (before and after         3,875
         continuing nursing education trips)
         Purchasing and cleaning uniforms              1,450
         Nursing association membership                  110
         Nursing journal subscriptions                    98
         State nursing license fee                       250
         National nursing accreditation fee              350
         Union dues                                      600
           Total                                      22,424

Petitioner did not offer any evidence to support her continuing

education trips or her job searches.    She was unable to remember

any details about these trips, including the names of the cities

where she attended nursing courses and inquired about employment.

Petitioner explained that she met with people and asked about the

kinds of jobs and salaries available for nurses in these cities,

but that she did not apply or interview for any jobs.

     Petitioner testified credibly about the need to buy and

maintain her nursing uniforms, about requirements that she

maintain her skills by reading journals and pursuing continuing

medical education, and about the costs associated with

     2
       In response to the Internal Revenue Service’s (IRS’s)
request for information about petitioner’s job-related expenses,
petitioner mailed the IRS a letter summarizing those expenses.
The expenses summarized in petitioner’s letter, which is dated
before the 2006 fire, are the same as petitioner’s reconstructed
expenses.
                               - 7 -

maintaining her nursing license and accreditation.    Petitioner

conceded that she did not pay union dues in 2003 but did not

explain the $10 difference between the sum of her expenses as

reconstructed and the amount she claimed.

                            Discussion

     In general, the Commissioner’s determinations set forth in a

notice of deficiency are presumed correct, and the taxpayer bears

the burden of proving that these determinations are in error.

Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933).

Pursuant to section 7491(a), the burden of proof as to factual

matters shifts to the Commissioner under certain circumstances.

Petitioner has neither alleged that section 7491(a) applies nor

established her compliance with its requirements.    Petitioner

therefore bears the burden of proof.

     Deductions are a matter of legislative grace, and taxpayers

bear the burden of proving that they are entitled to any

deduction claimed.   INDOPCO, Inc. v. Commissioner, 503 U.S. 79,

84 (1992); New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440

(1934).   Taxpayers are required to maintain records sufficient to

enable the Commissioner to determine their correct tax liability.

Sec. 6001; sec. 1.6001-1(a) Income Tax Regs.   Such records must

substantiate both the amount and purpose of the claimed

deductions.   Higbee v. Commissioner, 116 T.C. 438, 440 (2001).
                                - 8 -

     When a taxpayer establishes that she has incurred a

deductible expense but is unable to substantiate the exact

amount, we are generally permitted to estimate the deductible

amount.    Cohan v. Commissioner, 39 F.2d 540, 543-544 (2d Cir.

1930).    To apply the Cohan rule, however, the Court must have a

reasonable basis upon which to make an estimate.    Vanicek v.

Commissioner, 85 T.C. 731, 742-743 (1985).

     Congress overrode the Cohan rule with section 274(d), which

requires strict substantiation for certain categories of

expenses; in the absence of evidence demonstrating the exact

amount of those expenses, deductions for them are to be

disallowed entirely.    Sanford v. Commissioner, 50 T.C. 823, 827

(1968), affd. per curiam 412 F.2d 201 (2d Cir. 1969).   Expenses

subject to section 274(d) include travel and meal expenses, as

well as expenses for listed property, such as passenger

automobiles, computers, and cellular telephones.   Secs. 274(d),

280F(d)(4).   The taxpayer must substantiate the amount, time,

place, and business purpose of these expenditures and must

provide adequate records or sufficient evidence to corroborate

her own statement.   See sec. 274(d); sec. 1.274-5T(c)(1),

Temporary Income Tax Regs., 50 Fed. Reg. 46016 (Nov. 6, 1985).

An exception allows the taxpayer to substantiate her expenses

through a reasonable reconstruction of her records, but only

where the taxpayer establishes that her records were lost due to
                                 - 9 -

circumstances beyond her control, such as to fire, flood,

earthquake, or other casualty.     Sec. 1.274-5T(c)(5), Temporary

Income Tax Regs., 50 Fed. Reg. 46022 (Nov. 6, 1985).

1.   Medical and Dental Expenses

      Section 213(a) allows as a deduction any expenses that are

paid during the taxable year for the medical care of the

taxpayer, her spouse, and dependents and that are not compensated

for by insurance or otherwise.     Estate of Smith v. Commissioner,

79 T.C. 313, 318 (1982).   The deduction is allowed only to the

extent the amount exceeds 7.5 percent of the taxpayer’s adjusted

gross income.   Sec. 213(a); sec. 1.213-1(a)(3), Income Tax Regs.

The term “medical care” includes amounts paid “for the diagnosis,

cure, mitigation, treatment, or prevention of disease, or for the

purpose of affecting any structure or function of the body”.

Sec. 213(d)(1)(A); Estate of Smith v. Commissioner, supra at

318-319.   Expenditures which merely provide a general health

benefit are not deductible because deductions allowable under

section 213 are confined strictly to expenses paid primarily for

the prevention or alleviation of a physical or mental defect or

illness.   Sec. 1.213-1(e)(1)(ii), Income Tax Regs.

      Petitioner claimed that she spent $60 per day, 5 days each

week to have practitioners from her church treat her.     However,

petitioner has not provided any substantiation for the amounts

she paid the religious practitioners.     Accordingly, we cannot
                                - 10 -

estimate any amount of that deduction.    On the basis of the

record, we sustain respondent's disallowance of petitioner’s

claimed deduction for $15,600 in mental health treatment obtained

through her church.3   See sec. 6001; sec. 1.6001-1(a), (e),

Income Tax Regs.

      Petitioner claimed a deduction for $1,174 relating to her

purchasing health insurance for her domestic partner in 2003.

Petitioner did not allege or prove that her partner was either

her spouse or her dependent in 2003.     Accordingly, this expense

is not deductible under section 213(a).

      Although petitioner provided some evidence to support her

other claimed medical and dental expenses for 2003, those

expenses total $4,941, which is less than the floor imposed by

section 213(a).    Petitioner is not entitled to an itemized

deduction in 2003 for medical and dental expenses.4

2.   Charitable Contributions

      Section 170 allows deductions for charitable contributions

made during a taxable year, provided the taxpayer verifies the


      3
       Petitioner did not introduce any documents or provide
testimony about the specific types of medical treatments provided
by these religious practitioners. Because we decide this issue
on the basis of petitioner’s failure to substantiate, we need not
and do not decide whether the services provided through
petitioner’s church are deductible medical services.
      4
       We note that the $2,866 petitioner contributed pretax to
her beneflex health flexible spending account would further
reduce her substantiated health and dental expenses.
                                - 11 -

contributions.   Taxpayers are required to substantiate donations

made by cash or check via (1) canceled checks, (2) receipts from

the donee (showing the donee’s name and the date and amount of

the donation), or (3) other reliable written records.     Sec.

1.170A-13(a)(1), Income Tax Regs.    Taxpayers must substantiate

gifts of property via receipts from the donee (showing the

donee’s name, the date and location of the contribution, and a

description of the property contributed).    Sec. 1.170A-13(b)(1),

Income Tax Regs.   For charitable contributions over $250,

additional substantiation is required.    Sec. 170(f)(8).

     Petitioner reconstructed and documented cash contributions

of $225 and $624 for 2003.   On the basis of the record, we allow

a deduction for these contributions, amounting to $849.

     Petitioner did not provide support for her noncash

contributions or for the cash donations she made during AA

meetings and church services.    In the absence of corroborating

evidence, we are not required to accept, and do not accept,

petitioner’s self-serving testimony that she made those

donations.   See Tokarski v. Commissioner, 87 T.C. 74, 77 (1986);

Madden v. Commissioner, T.C. Memo. 2006-4.    Accordingly, we

sustain respondent’s disallowance of petitioner’s deductions for
                              - 12 -

the $500 noncash contribution and the remaining $4,151 in cash

charitable contributions.5

3.   Miscellaneous Itemized Deductions

      Section 162 allows deductions for all ordinary and necessary

business expenses paid or incurred during the taxable year in

carrying on a trade or business.   Performing services as an

employee constitutes a trade or business.    Primuth v.

Commissioner, 54 T.C. 374, 377-378 (1970).   Those expenses that

are (1) ordinary and necessary to the taxpayer’s business and (2)

paid or incurred in a given year are deductible that year.     Sec.

162(a); see sec. 1.162-17(a), Income Tax Regs.   However,

personal, living, or family expenses are not deductible.    See

secs. 162(a), 262(a); sec. 1.162-17(a), Income Tax Regs.

      Petitioner’s travel to and attendance at nursing

conferences, like her travel and expenses for job searches before

and after such conferences, are subject to the strict

substantiation requirements of section 274(d).   We may not

estimate those expenses, but taxpayers may reasonably reconstruct

their records to substantiate expenses if the records are lost.

Petitioner claimed her records must have been lost but did not

offer any reconstruction of the expenses or any detailed


      5
       Because we sustain respondent’s disallowance due to lack
of substantiation, we need not and do not decide whether cash
deposited into the collection basket during Alcoholics Anonymous
meetings is a charitable contribution.
                               - 13 -

testimony about the travel.    Accordingly, she is not entitled to

deduct any of the expenses claimed for continuing education trips

or for job searches.

     Petitioner testified credibly about her need to purchase new

uniforms and to have them professionally cleaned regularly.

Where business clothes are suitable for general wear, their cost

is typically not deductible.     Yeomans v. Commissioner, 30 T.C.

757, 767-769 (1958).    However, where custom and usage forbid

wearing a uniform when off duty, deduction is allowed.    The cost

of maintaining clothes for work is deductible when the purchase

price was deductible.    Hynes v. Commissioner, 74 T.C. 1266, 1290

(1980).   We accept petitioner’s testimony that she spent $1,450

to purchase and maintain her nursing uniforms in 2003 and

conclude that she is entitled to deduct this amount.

     We also accept petitioner’s testimony that her nursing

association membership fee and nursing journal subscription

expenses are ordinary and necessary expenses related to her work

as a nurse.   She is entitled to deductions of $110 and $98,

respectively, for these items.    Likewise, the fees incurred to

renew her State nursing license and her national nursing

accreditation are ordinary and necessary expenses of her nursing

profession, and she is entitled to deductions of $250 and $350,

respectively, for those expenses.
                                - 14 -

        Finally, we accept petitioner’s testimony that she paid $55

to rent a safe deposit box in 2003, and she is entitled to deduct

that amount.

4.   Failure To File Addition to Tax

        Respondent determined a $130.50 addition to tax for

petitioner’s late-filed return for 2003.

        Section 6651(a)(1) imposes an addition to tax of 5 percent

per month of the amount of tax required to be shown on the

return, not to exceed 25 percent, for failure to timely file a

return.     The addition to tax under section 6651(a)(1) is imposed

unless the taxpayer establishes that the failure was due to

reasonable cause and not willful neglect.6    The record does not

establish that petitioner’s failure to timely file her 2003

return was due to reasonable cause and not willful neglect.

Thus, petitioner is liable for the section 6651(a)(1) addition to

tax.7




        6
       Sec. 7491(c) provides that the Commissioner has the burden
of production in any Court proceeding with respect to liability
for an addition to tax. Respondent has established that the tax
return for 2003 was not timely filed.
        7
       Because we have allowed some deductions disallowed by
respondent, the amount of tax required to be shown on
petitioner’s 2003 return will be different from the amount shown
on the notice of deficiency, and the addition to tax, which is 25
percent of that amount, will also differ. We leave the
recalculation to the parties’ Rule 155 computations.
                        - 15 -

To reflect our disposition of the issues,


                                   Decision will be entered

                              under Rule 155.
