                        T.C. Memo. 2003-232



                      UNITED STATES TAX COURT



                   DIETER STUSSY, Petitioner v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 4088-02.                Filed August 4, 2003.



     Dieter Stussy, pro se.

     Angelique M. Neal, for respondent.



              MEMORANDUM FINDINGS OF FACT AND OPINION


     LARO, Judge:   Petitioner petitioned the Court to redetermine

a $2,983 deficiency in his 1998 Federal income tax.     Following

concessions by respondent, we are left to decide:

     1.   Whether petitioner may deduct interest paid on his

personal income tax liability.   We hold he may not.
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     2.   Whether petitioner may deduct charitable contributions

claimed for expenditures made to his personal residence which

were allocable to space used exclusively by a section 501(c)(3)

organization named the Jan Stussy Foundation (Foundation).      We

hold he may not.

     3.   Whether petitioner may deduct at the standard mileage

rate his automobile expenses connected to the determination of

his personal income tax liability.     We hold he may.

     Unless otherwise indicated, section references are to the

Internal Revenue Code in effect for the years in issue.    Rule

references are to the Tax Court Rules of Practice and Procedure.

Dollar amounts are rounded.

                         FINDINGS OF FACT

     Some facts were stipulated.   The stipulated facts and the

accompanying exhibits are incorporated herein by this reference.

We find the stipulated facts accordingly.     Petitioner resided in

Los Angeles, California, when his petition was filed.

     During 1998, petitioner resided in a single family residence

(residence).   The residence measured 2,085 square feet and was

titled in the name of the Stussy Family Trust (Trust).

Petitioner’s father, Jan Stussy (Dean Stussy), was the Trust’s

beneficial owner up until his death on July 31, 1990.    Dean

Stussy was an active professional painter, and he was the Dean of
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the School of Art at the University of California at Los

Angeles.1    Dean Stussy resided in the residence until his death.

     The Foundation is a section 501(c)(3) organization that was

formed in 1990.    The Foundation is responsible for storing,

cataloging, and selling the paintings and other artwork of Dean

Stussy (collectively, Dean Stussy artwork).    The Foundation began

storing the Dean Stussy artwork at the residence at or about the

time the Foundation was formed and continued to store the Dean

Stussy artwork there throughout the subject year.    The Dean

Stussy artwork stored at the residence included approximately 100

pieces which measured 4 feet by 8 feet and approximately 1,000

pieces which measured 4 feet by 4 feet.    The Foundation valued

its Dean Stussy artwork at $820,934 as of December 31, 1998.

     Pursuant to a “Deed of Gift and License” dated April 30,

1990, Dean Stussy made two gifts to the Foundation.       The first

gift was the Dean Stussy artwork.    The second gift was a license

to the exclusive use of four rooms (collectively, rooms) in the

residence.    The rooms, none of which during the subject year were

used by petitioner for personal purposes, totaled 900 square

feet.    Petitioner was not entitled to collect from the Foundation

any rent on the rooms, and the Foundation was liable for only the

payment of insurance.




     1
         Dean Stussy painted more than 7,000 paintings.
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     During 1998, petitioner paid the following expenses with

respect to the residence:   Insurance of $841, utilities of

$1,729, homeowner’s association dues of $30, pest control of

$478, and repairs and maintenance of $1,704 (to replace a water

heater, to clear brush around the perimeter of the residence, and

to repair the furnace).   Petitioner allocated these expenses to

the Foundation using a percentage allocation and claimed a

charitable contribution for the portion of the allocated

expenses.   Petitioner did not receive any written acknowledgment

from the Foundation for any contributions purportedly made to the

Foundation by petitioner during 1998.   Nor did the Foundation

report its receipt of any contributions during 1998.

     During 1998, petitioner drove 275.1 miles for which he

claims a miscellaneous itemized deduction at the standard mileage

rate.   The breakdown of these miles was:   165.5 miles for

petitioner’s copying and filing of his personal Federal and State

income tax returns, 82.7 miles for petitioner’s meetings with

Internal Revenue Service personnel related to the examination of

his personal income tax returns, 14.5 miles for petitioner’s trip

to the Santa Monica law library, and 12.4 miles for petitioner’s

copying of a document entitled “Response to AG of IRS

Investigation”.

     Petitioner’s 1998 Federal income tax return included 2

Schedules C, Profit or Loss From Business.    One of these
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schedules was for petitioner’s return preparation business.       This

Schedule C reported $550 of gross receipts and a net loss of $20.

The other Schedule C listed the proprietor as “D. Stussy, as

successor per IRC section 691(b)” and reported that the

proprietor’s principal business activity was “Artist”.     This

Schedule C reported no gross receipts and one expense.     This

expense, in the amount of $4,665, was Federal and State income

tax deficiency interest paid as to petitioner’s 1992 through 1995

personal income tax returns.   Petitioner’s income tax liabilities

for 1992, 1993, and 1994 were determined by respondent on the

basis of this Court’s memorandum opinion in Stussy v.

Commissioner, T.C. Memo. 1997-293.

                               OPINION

1.   Burden of Proof

      The parties dispute who bears the burden of proof.    We need

not and do not decide that issue.    The record is sufficient for

us to decide this case on its merits.

2.   Interest

      Petitioner claims as a sole proprietorship expense a

deduction for interest that he paid with respect to his personal

Federal and State income taxes.   Petitioner recognizes that the

Court of Appeals for the Ninth Circuit, the court to which this

case is appealable, held in Redlark v. Commissioner, 141 F.3d 936

(9th Cir. 1998), revg. and remanding 106 T.C. 31 (1996), that
                                - 6 -

this type of interest is nondeductible personal interest under

section 1.163-9T, Temporary Income Tax Regs., 52 Fed. Reg. 48409

(Dec. 22, 1987).   Petitioner argues that section 1.163-9T,

Temporary Income Tax Regs., supra, does not apply here (and,

hence, neither does Redlark v. Commissioner, supra) in that, he

claims, those regulations have expired under section 7805(e)(2).

     We disagree with petitioner that the referenced regulations

have expired under section 7805(e)(2).   Whereas petitioner notes

correctly that the regulations in section 1.163-9T, Temporary

Income Tax Regs., supra, are temporary regulations and that

section 7805(e)(2) provides that “Any temporary regulation shall

expire within 3 years after the date of issuance of such

regulation”, petitioner fails to observe that section 7805(e)(2)

applies only to regulations issued after November 20, 1988.

Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100-647,

sec. 6232(a), 102 Stat. 3734.   Section 1.163-9T, Temporary Income

Tax Regs., supra, was issued on December 22, 1987, approximately

11 months before the effective date of section 7805(e)(2).    On

the basis of Redlark v. Commissioner, supra, and, more recently,

our opinion in Robinson v. Commissioner, 119 T.C. 44 (2002)

(holding that this Court shall no longer follow our opinion in

Redlark as to this issue), we sustain respondent’s determination

on this issue.
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3.   Charitable Contributions

      Petitioner argues that the expenses connected to the

residence are deductible as charitable contributions to the

extent that they benefited the Foundation.    Respondent argues

that petitioner may not deduct any of these expenses in that he

does not have a written acknowledgment from the Foundation as to

them.

      We agree with respondent that none of the expenses are

deductible given the absence of a written acknowledgment.      Under

section 170(f)(8)(A), an individual taxpayer may deduct a

contribution of $250 or more only if he or she substantiates the

deduction with a contemporaneous written acknowledgment that

meets the requirements of that section.    See also Addis v.

Commissioner, 118 T.C. 528, 533-534 (2002).     That acknowledgment,

which must be furnished by the donee organization, must state the

amount of cash and describe other property contributed, indicate

whether the donee organization provided any goods or services in

consideration for the contribution, and provide a description and

good faith estimate of the value of any goods or services

provided by the donee organization.     Sec. 170(f)(8)(B); see also

sec. 1.170A-13(f)(5), Income Tax Regs. (goods or services include

cash, property, services, benefits, and privileges).    Given that

petitioner does not have such a written acknowledgment from the

Foundation as to the disputed expenses, we conclude that he is
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precluded from deducting them.    See Weyts v. Commissioner, T.C.

Memo. 2003-68.   A contrary conclusion would contravene the

statutory text and the purpose of recordkeeping for contributions

in excess of $250.

4.   Mileage

      Petitioner argues that he may deduct as a miscellaneous

itemized deduction an amount for the 275.1 miles that he drove

during the year in connection with the determination of his

personal income tax liabilities.    Respondent argues that all of

this mileage is personal and, hence, nondeductible.   Respondent

also argues that the mileage was not incurred either in

connection with the determination, collection, or refund of a

tax, or as an ordinary and necessary expense related to the

determination, collection, or refund of a tax.   Yet, respondent

does not dispute (and in fact has stipulated) that the 275.1

miles were driven for the purposes which we have described supra

at p. 5.

      We hold that petitioner may deduct all of the disputed

mileage at the standard mileage rate.    Section 212(3) allows an

individual to deduct “all the ordinary and necessary expenses

paid or incurred during the taxable year * * * in connection with

the determination, collection, or refund of any tax.”     The

Treasury Department has interpreted this section as follows:

      Expenses paid or incurred by an individual in
      connection with the determination, collection, or
                               - 9 -

     refund of any tax, whether the taxing authority be
     Federal, State, or municipal, and whether the tax be
     income, estate, gift, property, or any other tax, are
     deductible. Thus, expenses paid or incurred by a
     taxpayer for tax counsel or expenses paid or incurred
     in connection with the preparation of his tax returns
     or in connection with any proceedings involved in
     determining the extent of tax liability or in
     contesting his tax liability are deductible. [Sec.
     1.212-1(l), Income Tax Regs.]

     We find that all of the disputed mileage was an ordinary and

necessary expense paid by petitioner during 1998 in connection

with the determination of his Federal and State income taxes.2

We conclude on the basis of this finding that the mileage is

properly deductible as a miscellaneous itemized deduction under

section 212(3).   Whereas we agree with respondent that section

262 generally precludes any deduction for personal expenses, and

that this mileage is all attributable to petitioner’s personal

income taxes, we also observe that the exception in section

212(3) for expenses of contesting tax liabilities was prescribed

specifically by the Congress to allow taxpayers to deduct a




     2
       Although the 165.5 miles which petitioner claims to have
driven for the copying and filing of his personal income tax
returns appear to be high considering that petitioner lived in a
large metropolis, the parties have stipulated that petitioner
incurred all of these miles for the “copying and filing of his
personal federal and state income tax returns”. Respondent does
not claim that the amount of these miles is excessive.
                             - 10 -

personal expense that would otherwise be nondeductible.   United

States v. Gilmore, 372 U.S. 39, 48 n.16 (1963).


                                             Decision will be

                                        entered under Rule 155.
