                         T.C. Memo. 2007-151



                       UNITED STATES TAX COURT



         CHRISTOPHER D. AND KRISTIE M. FARRAN, Petitioners v.
             COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 20434-05.               Filed June 14, 2007.



     Christopher D. and Kristie M. Farran, pro sese.

     Melissa J. Hedtke, for respondent.


               MEMORANDUM FINDINGS OF FACT AND OPINION


     KROUPA, Judge:    Respondent determined a $2,206 deficiency in

petitioners’ Federal income tax for 2003.      After concessions,1 we

are asked to decide two issues.    First, we are asked to decide

whether petitioner Christopher Farran (Mr. Farran) was away from

home when he worked as an airline mechanic for Northwest Airlines


     1
      See infra note 2 for the concessions each party made.
                                - 2 -

(NWA) in Detroit, Chicago, and Boston to determine whether

petitioners are entitled to deduct expenses for his vehicle,

meals, and lodging while Mr. Farran was away from Farmington,

Minnesota, in the Minneapolis area where he normally lived.    We

conclude that he was not away from home.     Second, we are asked to

decide whether petitioners substantiated various other expenses.

We conclude that petitioners have substantiated and are entitled

to deduct some of these other expenses.

                          FINDINGS OF FACT

     Some of the facts have been stipulated and are so found.

Petitioners resided in Dallas, Georgia, at the time they filed

the petition.

Mr. Farran’s Employment With NWA

     Mr. Farran was an airline mechanic for NWA beginning in 1998

and continuing through 2003.    Mr. Farran worked in Minneapolis

until 2001.

     NWA sent layoff notices to some of its employees when it

experienced financial difficulties.     The employees receiving the

notices could either choose to accept the layoff or exercise

their seniority.    Seniority depended on the length of time an

employee worked for NWA regardless of where the airline facility

was located.    An employee with higher seniority could bump an

employee with less seniority and take that employee’s position.

The employee with less seniority could then take the layoff or
                                 - 3 -

find another employee with less seniority to bump.    This

seniority bumping arrangement was in place across the country, so

that an NWA mechanic looking to keep his or her job at NWA had to

look at several different cities to find a less senior employee

to bump.    Most employees exercised their seniority in the way

that would give them positions in cities as close as possible to

their families.

     Mr. Farran first received a bump notice in late 2001.      Mr.

Farran chose to exercise his seniority and bump another employee

rather than accept the layoff.    Mr. Farran was able to bump to a

position in the relatively close location of Duluth, but was then

bumped again to Detroit, where he started in November 2001.     Mr.

Farran worked in Detroit until February 3, 2003, and then was

bumped again, this time exercising his seniority to take a

position in Chicago.    Mr. Farran worked for NWA in Chicago from

February 4 through February 25, 2003.    Mr. Farran was then bumped

a final time and exercised his seniority to take a position in

Boston, where he worked from February 26 through March 21, 2003.

Mr. Farran ceased working for NWA on March 22, 2003.

     Mr. Farran was unemployed after he left NWA until November

17, 2003.    Mr. Farran searched for a job during those months and

took courses at Dakota County Technical College, including

courses in hydraulics, industrial electronics, and motor

controls.    These courses expanded Mr. Farran’s skills as an
                                - 4 -

airline mechanic and built on the knowledge Mr. Farran already

had.    Mr. Farran received a certificate or some other type of

credential for completing the program.    Mr. Farran drove back and

forth from petitioners’ home in Farmington, Minnesota, to the

college on the days his classes met.

       Mr. Farran ultimately accepted a position with Gulfstream

Aerospace in Atlanta, Georgia, starting November 17, 2003.     Mr.

Farran worked for Gulfstream Aerospace until July 2004.

       Mr. Farran’s positions in Detroit, Chicago, and Boston had

no specific end dates.    The timing of a return to the Minneapolis

area would depend on NWA’s needs for mechanics in that city as

well as the choices of other mechanics also subject to the

seniority system.

       Mr. Farran’s family stayed in Minnesota at the family

residence while Mr. Farran was working for NWA in Detroit,

Chicago, and Boston, and Mr. Farran returned periodically to

visit them.    While Mr. Farran was working in Detroit, Chicago,

and Boston, he found that hotels were quite expensive and

determined it would be impossible to get an apartment.    He

decided it would be impractical to move his family to these

locations and mostly lived in his car.    Mr. Farran kept a

calendar for 2003 in Minnesota on which he and his wife

periodically noted amounts Mr. Farran incurred for hotels,

mileage, and food.
                                - 5 -

     Petitioners maintained Internet access at the Minnesota

residence for the whole year.    Mr. Farran used the Internet when

he was in Minnesota to search for a job and to monitor

investments, but no other family member used it.    Mr. Farran also

incurred some other costs, such as for resume paper, in his job

search.   Mr. Farran also had a cellular phone during 2003 that he

acknowledged using for personal calls.     Mr. Farran’s family moved

to Georgia at a date not evident in the record and lived in

Georgia at the time of trial.

     Mr. Farran used some of his own tools in his work for NWA.

Mr. Farran also wore a uniform while he worked for NWA.     He

generally wore one shirt per day and cleaned his clothing in a

washing machine.   Mr. Farran estimated that he worked

approximately 22 days per month for NWA.

     Petitioner Kristie Farran (Mrs. Farran) was a substitute

teacher during 2003.   Mr. and Mrs. Farran donated a 1989 Pontiac

Sunbird with a Kelley Blue Book value of $1,750 to Volunteers of

America, Inc. in April 2003.    Volunteers of America later sold

this vehicle in “as is” condition for $40.     Mr. and Mrs. Farran

contributed some items to Goodwill and also bought items for

their children’s school during 2003.

Petitioners’ Return

     Petitioners claimed certain expenses on Schedule A, Itemized

Deductions, on the return for 2003.     Respondent examined the
                               - 6 -

return and issued petitioners a deficiency notice in which he

disallowed many of the expenses.   Of the expenses still in

dispute,2 petitioners assert they are entitled to claimed noncash

charitable contributions as well as unreimbursed employee

business expenses.   The unreimbursed employee business expenses

petitioners claimed include expenses for Mr. Farran’s vehicle,

lodging, and meals while in Detroit, Chicago, and Boston as well

as expenses for Internet access, uniform cleaning, tools,

depreciation of tools, personal property taxes, job searching,

supplies, parking, publications, cellular telephone, and

education mileage.

     Petitioners timely filed a petition.

                              OPINION

     The parties resolved many of the disputed expenses before

trial.   We are asked to determine whether petitioners are

entitled to deduct the remaining expenses.   We begin by

considering whether Mr. Farran was away from home when he

incurred expenses for his vehicle, meals, and lodging in Detroit,

Chicago, and Boston.



     2
      Respondent concedes that petitioners are entitled to deduct
State and local taxes, real estate taxes, a portion of personal
property taxes, home mortgage interest, tax preparation fees, a
portion of job search expenses including job search mileage
expenses, job union mileage expenses, certain amounts for tools,
and union dues. Petitioners concede that they are not entitled
to deduct cash contributions to charity and a portion of uniform
cleaning expenses.
                                  - 7 -

Travel Expenses While Away From Home

     We begin by briefly outlining the rules for deducting travel

expenses.      A taxpayer may deduct reasonable and necessary travel

expenses such as vehicle expenses, meals, and lodging incurred

while away from home in the pursuit of a trade or business.

Secs. 162(a)(2), 262(a).3     A taxpayer must show that he or she

was away from home when he or she incurred the expense, that the

expense is reasonable and necessary, and that the expense was

incurred in pursuit of a trade or business. Commissioner v.

Flowers, 326 U.S. 465, 470 (1946).        The determination of whether

the taxpayer has satisfied these requirements is a question of

fact.    Id.

     The purpose of the deduction for expenses incurred away from

home is to alleviate the burden on the taxpayer whose business

needs require him or her to maintain two homes and therefore

incur duplicate living expenses.      Kroll v. Commissioner, 49 T.C.

557, 562 (1968).     The duplicate costs are not deductible where

the taxpayer maintains two homes for personal reasons.       Sec. 262;

Commissioner v. Flowers, supra at 474.

     A taxpayer may deduct the expenses he or she incurred while

away from home.     Sec. 162(a)(2).   The word “home” for purposes of



     3
      All section references are to the Internal Revenue Code in
effect for 2003, and all Rule references are to the Tax Court
Rules of Practice and Procedure, unless otherwise indicated.
                                 - 8 -

section 162(a)(2) has a special meaning.      It generally refers to

the area of a taxpayer’s principal place of employment, not the

taxpayer’s personal residence.     Daly v. Commissioner, 72 T.C.

190, 195 (1979), affd. 662 F.2d 253 (4th Cir. 1981); Kroll v.

Commissioner, supra at 561-562.

     There is an exception to the general rule that a taxpayer’s

tax home is his or her principal place of employment.        Peurifoy

v. Commissioner, 358 U.S. 59, 60 (1958).       The taxpayer’s tax home

may be the taxpayer’s personal residence if the taxpayer’s

employment away from home is temporary.       Id.; Mitchell v.

Commissioner, T.C. Memo. 1999-283.       On the other hand, the

exception does not apply and the taxpayer’s tax home remains the

principal place of employment if the employment away from home is

indefinite.   Kroll v. Commissioner, supra at 562.

     It is presumed that a taxpayer will generally choose to live

near his or her place of employment.       Frederick v. United States,

603 F.2d 1292, 1295 (8th Cir. 1979).      A taxpayer must, however,

have a principal place of employment and accept temporary work in

another location to be away from home.       Kroll v. Commissioner,

supra.   A person who has no principal place of business nor a

place he or she resides permanently is an itinerant and has no

tax home from which he or she can be away.       Deamer v.

Commissioner, 752 F.2d 337, 339 (8th Cir. 1985), affg. T.C. Memo.

1984-63; Edwards v. Commissioner, T.C. Memo. 1987-396.
                               - 9 -

     All the facts and circumstances are considered in

determining whether a taxpayer has a tax home.   See Rev. Rul. 73-

529, 1973-2 C.B. 37 (describing objective factors the

Commissioner considers in determining whether a taxpayer has a

tax home).   The taxpayer must generally have some business

justification to maintain the first residence, beyond purely

personal reasons, to be entitled to deduct expenses incurred

while temporarily away from that home.    Hantzis v. Commissioner,

638 F.2d 248, 255 (1st Cir. 1981); Bochner v. Commissioner, 67

T.C. 824, 828 (1977); Tucker v. Commissioner, 55 T.C. 783, 787

(1971).   Where a taxpayer has no business connections with the

area of primary residence, there is no compelling reason to

maintain that residence and incur substantial, continuous, and

duplicative expenses elsewhere.   See Henderson v. Commissioner,

143 F.3d 497, 499 (9th Cir. 1998), affg. T.C. Memo. 1995-559;

Deamer v. Commissioner, supra; Hantzis v. Commissioner, supra.

In that situation, the expenses incurred while temporarily away

from that residence are not deductible.   Hantzis v. Commissioner,

supra; Bochner v. Commissioner, supra; Tucker v. Commissioner,

supra; see McNeill v. Commissioner, T.C. Memo. 2003-65; Aldea v.

Commmissioner, T.C. Memo. 2000-136.

     Once Mr. Farran was bumped from Minneapolis, he had no job

to return to there.   His choices were to be laid off and have no

work, or to bump other employees and move to different cities to
                               - 10 -

continue working.   NWA gave Mr. Farran no end date for his

positions in Detroit, Chicago, and Boston.    NWA no longer

required Mr. Farran to perform any services whatsoever in the

Minneapolis area once he was bumped.    Mr. Farran searched for

work in the Minneapolis area and took classes to further his

education, but was unsuccessful in finding a position in the

Minneapolis area.   In fact, he ultimately accepted a position in

Dallas, Georgia.    Although Mrs. Farran and the family remained in

the family residence with occasional visits from Mr. Farran while

Mr. Farran worked in Detroit, Chicago, and Boston, this fact

alone does not dictate that Mr. Farran’s tax home was in

Farmington, Minnesota, where the family residence was located.

Unlike traveling salespersons who may be required to return to

the home city occasionally between business trips, Mr. Farran’s

business ties to Minneapolis ceased when he was bumped.

     The Court understands that the NWA mechanics’ lives were

unsettled and disrupted.    Mechanics did not know how long they

would have a job in once specific location.    They only knew the

system was based on seniority.    They could bump less senior

employees, and they could be bumped by more senior employees.

While we acknowledge that Mr. Farran would have liked to return

to the Minneapolis area to work for NWA, Mr. Farran did not know

when such a return would be possible due to the seniority system.

The likelihood of Mr. Farran’s return to a position in
                               - 11 -

Minneapolis depended on NWA’s needs for mechanics there as well

as the choices of more senior mechanics.   Mr. Farran did not know

how long he would be in Detroit, Chicago, or Boston or where he

might go next.   It was not foreseeable that he would be able to

return to Minneapolis at any time due to the seniority system.

Thus, we conclude there was no business reason for petitioners

to maintain a home in the Minneapolis area.   Petitioners kept the

family residence in the Minneapolis area for purely personal

reasons.    Petitioners have failed to prove that Mr. Farran had a

tax home in 2003.   Accordingly, Mr. Farran was not away from home

in Detroit,4 Chicago, and Boston, and the expenses he incurred

while there are not deductible.5

Substantiation of Expenses

     We next turn to the substantiation issues to determine

whether petitioners are entitled to deduct any remaining

expenses.   We begin by noting the fundamental principle that the

Commissioner’s determinations are generally presumed correct, and


     4
      Even if we had found that Mr. Farran’s tax home during 2003
was Farmington, Minnesota, Mr. Farran may not be treated as
temporarily away from home while he worked in Detroit because the
position lasted over a year. See sec. 162(a).
     5
      It is unclear from the record whether petitioners are also
claiming travel expenses with respect to Mr. Farran’s position
with Gulfstream Aerospace in Georgia. Petitioners have
introduced no testimony or evidence with regard to Mr. Farran’s
employment in Georgia, and we must therefore conclude that
petitioners have failed to prove that Mr. Farran was away from
home when he incurred travel expenses in Georgia.
                              - 12 -

the taxpayer bears the burden of proving that these

determinations are erroneous.6   Rule 142(a); INDOPCO, Inc. v.

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

U.S. 111 (1933).   Moreover, deductions are a matter of

legislative grace, and the taxpayer has the burden to prove he or

she is entitled 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); Welch v. Helvering, supra.

This includes the burden of substantiation.   Hradesky v.

Commissioner, 65 T.C. 87, 90 (1975), affd. per curiam 540 F.2d

821 (5th Cir. 1976).

     A taxpayer must substantiate amounts claimed as deductions

by maintaining the records necessary to establish he or she is

entitled to the deductions.   Sec. 6001; Hradesky v. Commissioner,

supra.   The taxpayer shall keep such permanent records or books

of account as are sufficient to establish the amounts of

deductions claimed on the return.   Sec. 6001; sec. 1.6001-1(a),

(e), Income Tax Regs.   The Court need not accept a taxpayer’s

self-serving testimony when the taxpayer fails to present

corroborative evidence.   Beam v. Commissioner, T.C. Memo. 1990-




     6
      Petitioners do not claim the burden of proof shifts to
respondent under sec. 7491(a). Petitioners also did not
establish they satisfy the requirements of sec. 7491(a)(2). We
therefore find that the burden of proof remains with petitioners.
                               - 13 -

304 (citing Tokarski v. Commissioner, 87 T.C. 74, 77 (1986)),

affd. without published opinion 956 F.2d 1166 (9th Cir. 1992).

Unreimbursed Employee Business Expenses

     We shall now consider whether petitioners are entitled to

deduct the claimed expenses, beginning with the unreimbursed

employee business expenses petitioners claimed on Schedule A.

     In general, all ordinary and necessary expenses paid or

incurred in carrying on a trade or business during the taxable

year are deductible, but personal, living, or family expenses are

not deductible.    Secs. 162(a), 262.   Services performed by an

employee constitute a trade or business.     O’Malley v.

Commissioner, 91 T.C. 352, 363-364 (1988); sec. 1.162-17(a),

Income Tax Regs.

     If a taxpayer establishes that he or she paid or incurred a

deductible business expense but does not establish the amount of

the deduction, we may approximate the amount of the allowable

deduction, bearing heavily against the taxpayer whose

inexactitude is of his or her own making.     Cohan v. Commissioner,

39 F.2d 540, 543-544 (2d Cir. 1930).    For the Cohan rule to

apply, however, a basis must exist on which this Court can make

an approximation.    Vanicek v. Commissioner, 85 T.C. 731, 742-743

(1985).   Without such a basis, any allowance would amount to

unguided largesse.    Williams v. United States, 245 F.2d 559, 560

(5th Cir. 1957).
                                - 14 -

     Certain business expenses may not be estimated because of

the strict substantiation requirements of section 274(d).     See

sec. 280F(d)(4)(A); Sanford v. Commissioner, 50 T.C. 823, 827

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

expenses, only certain types of documentary evidence will

suffice.

Job Search Expenses

     We now examine those expenses not subject to the strict

substantiation requirements, beginning with job search expenses.

Petitioners claimed $156 for job search expenses during 2003.

     The parties stipulated that Mr. Farran incurred $119.43 of

job search expenses.   Petitioners introduced a bank statement,

receipts, and two bills to support their claim to the additional

amount for job search expenses.    Many of the documents

petitioners submitted are illegible, however, and do not

establish that these amounts were actually incurred in connection

with Mr. Farran’s job search.    We therefore conclude that

petitioners are entitled to deduct only the $119.43 of agreed

upon job search expenses.

Internet Access Expenses

     Petitioners claimed $264 for Internet access expenses during

2003.   We have characterized Internet expenses as utility

expenses.   Verma v. Commissioner, T.C. Memo. 2001-132.     Strict

substantiation therefore does not apply, and we may estimate the
                              - 15 -

business portion of utility expenses under the Cohan rule.     See

Pistoresi v. Commissioner, T.C. Memo. 1999-39.

     The parties stipulated that petitioners paid $219.50 for

Microsoft Online Service in 2003.   Mr. Farran testified that he

used the Internet during 2003 to search for a new job while he

was unemployed and also to monitor his investments.   Mr. Farran

also testified that Mrs. Farran and their children did not use

the Internet and he did not use it for other personal purposes.

     We found Mr. Farran’s testimony on this issue credible, and

we are convinced that a portion of Mr. Farran’s Internet use

during the time he was unemployed was to search for a job in his

field.   We are permitted to estimate the portion of this expense

attributable to job searching under the Cohan rule.    We estimate

that 50 percent of Mr. Farran’s Internet use during the 7 months

he was unemployed in 2003 was to search for a job.    Accordingly,

we conclude that petitioners are entitled to deduct $64 of

Internet access charges as job search expenses for 2003.

Cleaning Expenses for Uniforms

     Petitioners claimed $722 for cleaning expenses for Mr.

Farran’s NWA uniforms.   Expenses for uniforms are deductible if

the uniforms are of a type specifically required as a condition

of employment, the uniforms are not adaptable to general use as

ordinary clothing, and the uniforms are not worn as ordinary
                               - 16 -

clothing.   Yeomans v. Commissioner, 30 T.C. 757, 767-769 (1958);

Beckey v. Commissioner, T.C. Memo. 1994-514.

     We are satisfied that petitioners incurred deductible

expenses to clean Mr. Farran’s uniforms.      Mr. Farran gave unclear

testimony, however, regarding how he calculated the cleaning

costs.   Petitioners introduced a document on the letterhead of

his CPA that purports to indicate how the sum was calculated, but

it suggests an excessive amount, 22 cleanings for shirts and

pants and 2 for jackets per month.      Mr. Farran estimated he

worked 22 days per month and wore one shirt per day.      At trial,

Mr. Farran conceded that petitioners are not entitled to deduct

cleaning expenses for uniforms for the months he was unemployed.

     We may estimate the amount of deductible cleaning expenses

under the Cohan rule.    We adopt the unit cost of $1.35 listed on

petitioners’ exhibit as the cost to wash or dry one load of

laundry.    We find that approximately eight loads of laundry for

each of the 5 months Mr. Farran worked is a reasonable number to

yield 22 clean shirts and pants and 2 jackets per month.

Petitioners are therefore entitled to deduct $108 of uniform

cleaning expenses in 2003.

Tool Expenses

     Petitioners claimed $831 for tools Mr. Farran used as an

airline mechanic, and the parties stipulated that petitioners are

entitled to deduct $90.58.   A taxpayer is entitled to deduct
                               - 17 -

expenses for tools if they are ordinary and necessary business

expenses.   Sec. 162(a).

     Petitioners have offered no documentation or testimony

regarding the $740.42 of tool expenses claimed beyond what

respondent allowed.   We conclude that petitioners are not

entitled to deduct any additional amount for tools other than the

$90.58 agreed upon amount.

Depreciation Expenses

     Petitioners claimed $115 for depreciation of tools Mr.

Farran used at his job.    The cost of tools with useful lives

greater than a year is recoverable by depreciation.    Secs.

167(a), 168(b); Seawright v. Commissioner, 117 T.C. 294, 305

(2001); Clemons v. Commissioner, T.C. Memo. 1979-273.    Mr. Farran

testified that he did not have any receipts for the depreciated

tools but identified them as sockets and wrenches he thought

would last for years.

     The only documentary evidence petitioners introduced to

support their claimed deduction was a depreciation schedule for

the tools that indicates Mr. Farran acquired the tools on January

1, 1998.    Petitioners did not introduce any receipts to show the

tools’ purchase price or purchase date.

     Petitioners have not substantiated that they are entitled to

a depreciation deduction.    Further, we are unable to estimate any

amount for depreciation under the Cohan rule because the evidence
                                - 18 -

petitioners introduced is inadequate.    Petitioners are therefore

not entitled to deduct any amount for depreciation.

Personal Property Taxes

     Petitioners claimed $227 of personal property taxes for

2003, and respondent concedes that petitioners are entitled to

deduct $217 of these taxes.   Petitioners have presented no

argument or evidence regarding the additional $10 in personal

property taxes.   We conclude that petitioners are not entitled to

deduct the additional $10 in personal property taxes for 2003.

Supplies

     Petitioners claimed $64 for supplies in 2003.    Petitioners

introduced several receipts to support their claimed expenses for

supplies.   Several of the receipts petitioners introduced,

however, appear to be for traveling expenses such as hotels,

parking, and tolls, not supplies.    Moreover, the receipts that do

not appear to be for traveling expenses are illegible.

Petitioners introduced no testimony to explain what supplies

petitioners needed for their jobs and what specific supplies

petitioners sought to deduct.    We conclude that petitioners have

failed to substantiate their expenses for supplies and are not

entitled to deduct any amount for supplies in 2003.

Parking

     Petitioners claimed $8 for parking in 2003.   Petitioners

submitted a receipt for $5 for parking at Boston Logan
                                - 19 -

International Airport dated February 25, 2003, to support their

deduction for supplies.   It is unclear whether they want to also

assert that the $5 was part of the $8 claimed for parking.       If

this amount is for parking, it is unclear whether the amount paid

was a nondeductible commuting cost.      Without more of an

explanation, petitioners are not entitled to deduct any amount

for parking expenses in 2003.

Publications

     Petitioners claimed $26 for professional publications in

2003.   Mr. Farran testified that this amount represented books

that he needed for his classes at Dakota County Technical

College.    Petitioners have introduced no documentation or

substantiation of this expense, however.      We conclude that

petitioners are not entitled to deduct the $26 for professional

publications.

Expenses Subject to Strict Substantiation Requirements

     We now consider those expenses that are subject to the

additional strict substantiation requirements under section

274(d).    Expenses subject to strict substantiation may not be

estimated under the Cohan rule.    Sanford v. Commissioner, 50 T.C.

at 827.

     Cellular Phone Expenses

     Petitioners claimed $372 for cellular phone expenses for

2003.   Cellular phones are included in the definition of “listed
                               - 20 -

property” for purposes of section 274(d)(4) and are thus subject

to the strict substantiation requirements.      Gaylord v.

Commissioner, T.C. Memo. 2003-273.      A taxpayer must establish the

amount of business use and the amount of total use for the

property.   Nitschke v. Commissioner, T.C. Memo. 2000-230; sec.

1.274-5T(b)(6)(i)(B), Temporary Income Tax Regs., 50 Fed. Reg.

46016 (Nov. 6, 1985).

     Although the parties stipulated that petitioners paid

$324.42 for cellular phone service during 2003, petitioners did

not prove that NWA required Mr. Farran to have a cellular phone.

Moreover, Mr. Farran also admitted at trial that he used his

cellular phone in 2003 to make personal calls as well as for

business reasons.    Petitioners also did not offer any evidence

indicating how much Mr. Farran used his cellular phone in 2003

for business use and how much for personal use.     Petitioners

failed to establish that they incurred any expenses to use Mr.

Farran’s cellular phone for business purposes in addition to

those they would have incurred had Mr. Farran used it only for

personal purposes.    Petitioners are therefore not entitled to

deduct any cellular phone expenses for 2003.

     Education Mileage

     Petitioners claimed $461 of education mileage expenses for

2003.   Education expenses are generally deductible as ordinary

and necessary business expenses if either of two alternative
                               - 21 -

conditions are satisfied.   Sec. 1.162-5(a), Income Tax Regs.   The

education must either maintain or improve skills the taxpayer

needs for his or her trade or business, or the education must

meet express requirements set forth by law or regulation or the

taxpayer’s employer as a condition to the taxpayer’s retention of

his or her employment.   Id.   Even if the education meets one of

these alternatives, there is an exception to the deductibility of

education expenses.   Education expenses are not deductible if the

education allows the taxpayer to meet the minimum educational

requirements for his or her job or to qualify the taxpayer for a

new trade or business.   Garwood v. Commissioner, 62 T.C. 699

(1974); sec. 1.162-5(b), Income Tax Regs.

     Mr. Farran testified that the $461 petitioners claimed

represented mileage expenses incurred when Mr. Farran traveled

from his home in Farmington, Minnesota, to his classes at Dakota

County Technical College.   Passenger automobiles are listed

property under section 280F, and strict substantiation is

therefore required.   Sec. 274(d).   No deduction is allowed for

any travel expense unless the taxpayer corroborates by adequate

records or by sufficient evidence corroborating the taxpayer’s

own statement the amount of the expense, the mileage for each

business use of the automobile and the total mileage for all use

of the automobile during the taxable period, the date of the

business use, and the business purpose for the use.    Sec. 1.274-
                                - 22 -

5T(b)(6), Temporary Income Tax Regs., 50 Fed. Reg. 46016 (Nov. 6,

1985).     Adequate records include the maintenance of an account

book, diary, log, statement of expense, trip sheets, and/or other

documentary evidence, which, in combination, are sufficient to

establish each element of expenditure or use.      Sec. 1.274-

5T(c)(2)(i), Temporary Income Tax Regs., 50 Fed. Reg. 46017 (Nov.

6, 1985).

     Taxpayers may use a standard mileage rate established by the

Internal Revenue Service in lieu of substantiating the actual

amount of the expenditure.     See sec. 1.274-5(j)(2), Income Tax

Regs.     The standard mileage rate is generally multiplied by the

number of business miles traveled.       See Rev. Proc. 2002-61, 2002-

2 C.B. 616 (in effect for transportation expenses incurred during

2003).     The use of the standard mileage rate establishes only the

amount deemed expended with respect to the business use of a

passenger automobile.     Sec. 1.274-5(j)(2), Income Tax Regs.   The

taxpayer must still establish the actual mileage, the time, and

the business purpose of each use.     Nicely v. Commissioner, T.C.

Memo. 2006-172; sec. 1.274-5(j)(2), Income Tax Regs.

        Petitioners introduced a transcript from Dakota County

Technical College indicating that Mr. Farran took a variety of

courses in 2003, including hydraulics, industrial electronics,

and motor controls.     Mr. Farran testified that he did not receive

a degree from Dakota County Technical College but testified that
                              - 23 -

he received, essentially, a certificate.    Mr. Farran testified

that the courses expanded his current skills and built on what he

already knew.

     Petitioners also introduced a calendar indicating the days

during the year that Mr. Farran drove back and forth to Dakota

County Technical College.   Mr. Farran testified that petitioners

computed the deduction by determining the mileage between their

home and Dakota County Technical College and then found the

corresponding amount of allowable expenses by applying the

mileage rate formula for 2003.

     We are satisfied that Mr. Farran took courses at Dakota

County Technical College to improve his skills as an aircraft

mechanic.   We are also satisfied that Mr. Farran substantiated

the mileage and met the strict substantiation requirements

relating to vehicle expenses through petitioners’ careful

recordkeeping on their calendar.    We conclude that petitioners

are entitled to deduct $461 for education mileage expenses.

Charitable Contributions

     We finally consider petitioners’ charitable contributions.

Petitioners conceded at trial that they are not entitled to the

cash contributions they claimed on their return for 2003.

Petitioners claimed they contributed property worth $2,400 to

charitable organizations in 2003.
                              - 24 -

     Charitable contributions a taxpayer makes are generally

deductible under section 170(a).      No deduction is allowed,

however, for any contribution of $250 or more unless the taxpayer

substantiates the contribution by a contemporaneous written

acknowledgment of the contribution by a qualified donee

organization.7   Sec. 170(f)(8)(A).    The deduction for a

contribution of property equals the fair market value of the

property on the date contributed.     Sec. 1.170A-1(c)(1), Income

Tax Regs.   The fair market value of property is the price at

which the property would change hands between a willing buyer and

a willing seller, neither being under any compulsion to buy or

sell and both having a reasonable knowledge of relevant facts.

Sec. 1.170A-1(c)(2), Income Tax Regs.

     A taxpayer claiming a charitable contribution 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



     7
      There are now stricter requirements for contributions of
money. Sec. 170(f)(17). No deduction for a contribution of
money in any amount is allowed unless the donor maintains a bank
record or written communication from the donee showing the name
of the donee organization, the date of the contribution, and the
amount of the contribution. Id. This new provision is effective
for contributions made in tax years beginning after Aug. 17,
2006. Pension Protection Act of 2006, Pub. L. 109-280, sec.
1217, 120 Stat. 1080.
                               - 25 -

and the date and amount of the contribution.   Sec. 1.170A-

13(a)(1), Income Tax Regs.

     Petitioners claim they contributed property to three

charitable organizations in 2003.   We shall address each claimed

contribution in turn.   First, petitioners claim they contributed

a 1989 Pontiac Sunbird with a value of $1,750 to Volunteers of

America, Inc.   Petitioners introduced a donation receipt from

Volunteers of America, Inc. signed by a representative of the

organization, that substantiates petitioners indeed donated a

1989 Pontiac Sunbird and that petitioners received no goods or

services in exchange for the donation.   Petitioners also

introduced a page of the Kelley Blue Book for January-April 2003

indicating that the suggested retail for their vehicle was $1,750

at the time they donated it.   Respondent introduced evidence

indicating that Volunteers of America, Inc. sold the Pontiac

Sunbird less than 2 months after it was donated in “as is”

condition for $40.

     We have carefully examined the evidence presented on this

issue.   We discount the evidence that the charitable organization

subsequently sold the vehicle for $40 for several reasons.8


     8
      If a charity sells the donated vehicle without any
significant intervening use or material improvement, the
deduction is now limited to the gross proceeds of the sale. Sec.
170(f)(12). This provision is effective for charitable
contributions made after Dec. 31, 2004. American Jobs Creation
                                                   (continued...)
                               - 26 -

First, there is no evidence that the charity’s sale of the

vehicle was at arm’s length.   For example, the charity could have

sold the vehicle to a needy person for a small amount to further

the charity’s charitable goals.   Second, there is no evidence

that the vehicle was in the same condition when the charity sold

it as when petitioners donated it.      Certain parts of the vehicle

may have been sold separately, diminishing its value, or the

vehicle may have been in an accident.     On the other hand, the

Kelley Blue Book evidence that the vehicle was listed at $1,750

is a reliable indicator of the vehicle’s fair market value at the

time petitioners donated it.   After carefully considering the

evidence each side presented, we conclude that the vehicle was

worth $1,750 at the time petitioners donated it, and petitioners

have therefore substantiated their charitable contribution of

property worth $1,750 to Volunteers of America, Inc.

     We next turn to petitioners’ claimed contribution of

property worth $650 to Goodwill Industries.     Petitioners

introduced a Goodwill/Easter Seals document indicating that they

donated household, clothing, and other items on October 19, 2003,

and that petitioners received no goods or services in exchange.

The receipt does not list the specific items petitioners

contributed.   Mr. Farran testified that he added the $650 value


     8
      (...continued)
Act of 2004, Pub. L. 108-357, sec. 884, 118 Stat. 1632.
                               - 27 -

to the receipt himself.   Petitioners did not introduce any

evidence indicating the specific items petitioners contributed,

the estimated value of the items, or the quality of the items.

     While we are convinced that petitioners donated some items

to Goodwill in 2003, petitioners have failed to provide any

evidence of the items they donated or their estimated values.

Petitioners are therefore not entitled to deduct any amount for

contributions of property to Goodwill Industries in 2003.

     Finally, petitioners claim they donated some property to

their childrens’ school in 2003.    Petitioners’ tax return for

2003 does not indicate what amount petitioners deducted for

property they donated to their childrens’ school.    Petitioners

submitted various receipts indicating the purchase of items such

as ice cream, Baggies, and peanut butter.    Mr. Farran testified

that the donations were made for items used at least partly by

petitioners’ children, such as ice cream for their daughter’s

school birthday celebration.    These amounts are nondeductible

personal expenditures.    Further, petitioners have failed to

substantiate adequately these claimed donations.    Petitioners

introduced a letter from the elementary school indicating that

petitioners donated some items to their children’s classrooms.

Dollar values of the items donated are not provided in the

letter, and the letter is dated September 2006, not

contemporaneously with the contributions.    Moreover, the other
                               - 28 -

records petitioners submitted consist primarily of illegible

receipts for personal items.   The proof petitioners provided is

not sufficient to support petitioners’ claimed deduction for

contributions to their children’s school.    We conclude that

petitioners are not entitled to deduct any amount for

contributions of property to the school.

     To reflect the foregoing and the concessions of the parties,


                                           Decision will be entered

                                    under Rule 155.
