                        T.C. Summary Opinion 2015-74



                        UNITED STATES TAX COURT



              JAMSHED AHMED CHAUDRY, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent

                 JAMSHED CHAUDRY, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



      Docket Nos. 19609-13S, 26280-14S.           Filed December 21, 2015.



      Jamshed Ahmed Chaudry, pro se.

      Matthew S. Reddington, for respondent.



                             SUMMARY OPINION


      GERBER, Judge: These consolidated cases were heard pursuant to the

provisions of section 7463 of the Internal Revenue Code in effect when the
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petitions were filed.1 Pursuant to section 7463(b), the decisions to be entered are

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

precedent for any other case. Respondent determined income tax deficiencies for

petitioner’s 2010 and 2011 taxable years of $7,912 and $5,938.18, respectively.

Respondent also determined section 6662(a) penalties for 2010 and 2011 of

$1,582.40 and $1,187.64, respectively. The deficiencies are attributable to

respondent’s disallowance of certain deductions on Schedules A, Itemized

Deductions. The issues for our consideration are: (1) whether petitioner is

entitled to any of the deductions that respondent disallowed; and (2) whether

petitioner is liable for the accuracy-related penalties.

                                     Background

      Petitioner resided in Maryland at the time that his petitions were filed. On

Schedules A of his 2010 and 2011 income tax returns, petitioner claimed the

following deductions that respondent, after an audit examination, disallowed:

               Item                      2010                     2011

      Employee expenses                 $9,100                  $16,111
      Charitable contributions           6,231                    4,200
      Medical expenses                  27,000                   19,000

      1
      Unless otherwise indicated, all section references are to the Internal
Revenue Code in effect for the years at issue, and Rule references are to the Tax
Court Rules of Practice and Procedure.
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During respondent’s audit examination of the 2010 and 2011income tax returns,

petitioner was asked for substantiation of the above items, which he did not

provide, and respondent issued determinations disallowing the claimed

deductions.

      With respect to the charitable contribution deduction claimed for 2010,

petitioner provided evidence of the contribution of an automobile, and respondent

in the notice of deficiency allowed petitioner $1,469 as the fair market value of the

automobile contributed to the charity. Petitioner approached automobile dealers

who provided values for the automobile, the average of which was $3,000.

      Petitioner had several medical conditions during 2010 and 2011. His

physician provided a letter advising that petitioner required transportation and/or

assistance to travel to work and other places, including medical appointments.

                                     Discussion

      Generally, deductions are allowed only as provided by statute. INDOPCO,

Inc. v. Commissioner, 503 U.S. 79, 84 (1992). Petitioner bears the burden of

showing entitlement to the deductions claimed on Schedules A attached to his

2010 and 2011 income tax returns. See Rule 142(a); Welch v. Helvering, 290 U.S.

111, 115 (1933).
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A. Unreimbursed Employee Expenses

      For 2010 petitioner claimed a job-related expense deduction of $9,100 for

such items as uniforms, reference books, respiratory equipment, clinical scrubs,

professional clothes, laundry, cell phone, parking, tolls, transportation, and

miscellaneous. For 2011 petitioner claimed a job-related expense deduction of

$16,111 for such items as reference books, seminars, education, clothes, cell

phone, laundry, and miscellaneous.

      Miscellaneous itemized deductions, such as the deduction for unreimbursed

employee expenses, are allowed only to the extent that the aggregate amount

exceeds 2% of adjusted gross income. Sec. 67(a). In these cases, the 2%

threshold would exceed $2,000 for each year. With respect to the categories of

deductions that petitioner claimed, section 6001 requires that taxpayers maintain

records sufficient to substantiate the amounts claimed. In some instances, section

274(d) requires that more stringent recordkeeping and substantiation requirements

be met and that the taxpayer have adequate records or sufficient evidence

corroborating his own statement to substantiate expenses underlying the claimed

deductions.

      At trial petitioner did not offer any documentary or testimonial evidence to

support or substantiate the amounts of his job-related expenses for 2010 or 2011.
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Accordingly, we hold that respondent’s determination disallowing job-related

expense deductions of $9,100 and $16,111 for 2010 and 2011, respectively, is

sustained.

B. Charitable Contributions

      Taxpayers are allowed deductions under section 170(a) for charitable

contributions. Taxpayers are required to maintain records to substantiate amounts

underlying their claimed deductions. Sec. 6001.

      For 2010 petitioner claimed a deduction of $6,231 for charitable

contributions, and he provided documentation showing that an automobile had

been donated to a qualified charity, for which respondent allowed a $1,469

deduction.2 Petitioner went to auto dealers and received valuations, the average of

which was $3,000. Other than that evidence, petitioner did not substantiate the

remaining portions of the amounts underlying the charitable contribution

deduction claimed for 2010.

      For 2011 petitioner reported $4,000 for noncash contributions and $200 for

cash contributions to charity. Petitioner did not provide any cogent evidence




      2
      For 2010 respondent determined that petitioner’s allowable deductions
exceeded the standard deduction, whereas for 2011 the standard deduction
exceeded the deductions respondent allowed to petitioner.
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substantiating any portions of the amounts underlying the claimed charitable

contribution deduction for 2011.

      We accordingly hold that petitioner is entitled to a charitable contribution

deduction of $1,531 ($3,000 less $1,469) in addition to the amount respondent

allowed for 2010, and respondent’s determination to disallow a deduction for all

of the claimed charitable contributions for 2011 is sustained.

C. Medical Expenses

      Petitioner claimed medical expense deductions for 2010 and 2011 of

$27,000 and $19,000, respectively. Section 213(a) allows a deduction for medical

care the cost of which is not reimbursed by insurance. The aggregate amount

claimed for any taxable year is deductible only to the extent that it exceeds 7.5%

of the taxpayer’s adjusted gross income.

      Other than a letter from his doctor that generally indicated that petitioner

would need help getting places, petitioner presented no documentary evidence to

support the amounts claimed. Petitioner explained that he was not able to

transport himself to work and medical appointments and that he paid others to

transport him to various places. Petitioner admitted that most of his medical costs

and drugs were covered by an insurance plan and that he had a nominal copayment

for medicine. On his returns, most of the amounts underlying the claimed
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deductions were allegedly for insurance premiums, but at trial petitioner indicated

that large portions of his “medical” expenses were attributable to amounts that he

paid others to drive him to work, medical appointments, etc. Other than his

testimony, petitioner did not provide any evidence that amounts were paid to

others for medical transportation or assistance. Such expenditures, however, must

be substantiated.

      Accordingly, petitioner has not substantiated his claimed medical expenses

for 2010 or 2011, and respondent’s determination disallowing the deductions is

sustained.

D. Accuracy-Related Penalty

      Section 6662(a) and (b)(1) and (2) provides for a 20% penalty for an

underpayment of tax attributable to negligence or a substantial understatement of

income tax. Under section 7491(c) the Commissioner bears the burden of

production with respect to the penalty.

      Respondent, in his pretrial memorandum, contended that his burden of

production was met because petitioner was negligent in failing to keep and/or

present adequate records of expenses underlying claimed deductions and because

there is a substantial understatement of income tax for each year within the

meaning of section 6662(b)(2). We agree with respondent.
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      Petitioner has offered no testimony or other evidence concerning his

liability for this penalty and has not claimed that his actions were reasonable.

Accordingly, we hold that petitioner is liable for section 6662(a) accuracy-related

penalties for 2010 and 2011.

      To reflect the foregoing,


                                              Decision will be entered under

                                       Rule 155 in docket No. 19609-13S,

                                       and decision will be entered for respondent

                                       in docket No. 26280-14S.
