                  T.C. Summary Opinion 2004-76



                     UNITED STATES TAX COURT



                 LIONEL D. JONES, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent


     Docket No. 7827-03S.                 Filed May 27, 2004.


     Lionel D. Jones, pro se.

     Laura A. McKenna, for respondent.



     COUVILLION, Special Trial Judge:    This case was heard

pursuant to section 7463 of the Internal Revenue Code in effect

at the time the petition was filed.1    The decision to be entered

is not reviewable by any other court, and this opinion should not

be cited as authority.



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


     Respondent determined a deficiency of $6,436 in petitioner’s

Federal income tax for the year 2001.     After concessions,2 the

issues for decision are:   (1) Whether petitioner is entitled to

deduct certain unreimbursed employee expenses; and (2) whether

petitioner is entitled to a deduction for charitable

contributions under section 170.3

     Some of the facts were stipulated.     Those facts, with the

annexed exhibits, are so found and are made part hereof.

Petitioner’s legal residence at the time the petition was filed

was Memphis, Tennessee.

     Petitioner was employed in two separate occupations during

the year at issue, firefighting and law enforcement.     As a

firefighter, he was employed by the City of Memphis and worked

24-hour shifts.   On his days off from that job, he worked for the

police department of the Memphis Housing Authority.     Petitioner

was required to purchase uniforms for both his firefighting and

law enforcement occupations.   He received a small uniform



     2
          Respondent conceded petitioner's entitlement to two
dependency exemption deductions and head-of-household filing
status. Petitioner conceded an unreported interest income
adjustment.
     3
          Deductions are a matter of legislative grace, and
petitioner bears the burden of proving that he is entitled to the
deductions claimed. Rule 142(a); New Colonial Ice Co. v.
Helvering, 292 U.S. 435, 440 (1934). The burden of proof has not
shifted to respondent pursuant to sec. 7491 since petitioner has
not complied with the requirements of sec. 7491(a)(2)(A) and (B).
Higbee v. Commissioner, 116 T.C. 438 (2001).
                                - 3 -


allowance from the city for this purpose, which approximated the

cost of three pairs of firefighter uniform pants and one uniform

shirt, but other expenses were out of pocket.   Neither the police

nor the firefighter uniform was suitable for off-duty use, and in

fact such use was prohibited.

     Petitioner attended church regularly during the year at

issue.   Sometimes he would attend his father’s church and other

times his grandfather’s, but he contributed to both churches.    He

made weekly payments using offering envelopes provided by the

churches.   He put both cash and checks into these envelopes.

Petitioner also made a contribution by cash or check to the

Salvation Army during the year at issue.

     On his 2001 Federal income tax return, which was self-

prepared, petitioner reported $64,561 in wage income.   On

Schedule A, Itemized Deductions, he claimed a deduction for

$6,600 in unreimbursed employee expenses.4   He also claimed a

charitable contributions deduction of $6,045.   Respondent

disallowed the charitable contributions and miscellaneous

employee expenses deductions for lack of substantiation.

     With respect to the unreimbursed employee expenses, section

162 allows a deduction for ordinary and necessary expenses that



     4
          The claimed expenses yielded a deduction of $5,309
after the application of the 2-percent limitation under sec.
67(a).
                               - 4 -


are paid or incurred during the taxable year in carrying on a

trade or business.   Sec. 162(a); Deputy v. du Pont, 308 U.S. 488,

495 (1940).   A trade or business includes the trade or business

of being an employee.   O’Malley v. Commissioner, 91 T.C. 352,

363-364 (1988).

     In the case of travel expenses and certain other expenses,

such as entertainment, gifts, and expenses relating to the use of

listed properties, including cellular telephone or other similar

telecommunications equipment described in section 280F(d)(4)(A),

section 274(d) imposes stringent substantiation requirements to

document particularly the nature and amount of such expenses.

For such expenses, substantiation of the amounts claimed by

adequate records or by other sufficient evidence corroborating

the claimed expenses is required.   Sec. 274(d); sec. 1.274-

5T(a)(4), Temporary Income Tax Regs., 50 Fed. Reg. 46014 (Nov. 6,

1985).   To meet the adequate records requirements of section

274(d), a taxpayer "shall maintain an account book, diary, log,

statement of expense, trip sheets, or similar record * * * and

documentary evidence * * * which, in combination, are sufficient

to establish each element of an expenditure".   Sec. 1.274-

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

6, 1985).   These substantiation requirements are designed to

encourage taxpayers to maintain records, together with

documentary evidence substantiating each element of the expense
                                - 5 -


to be deducted.   Sec. 1.274-5T(c)(1), Temporary Income Tax Regs.,

50 Fed. Reg. 46017 (Nov. 6, 1985).

     At trial, petitioner did not produce canceled checks or

credit card receipts to substantiate the claimed employee

business expenses.   Rather, he presented a worksheet entitled

Fire Fighter and Law Enforcement Deductions listing expenses

totaling $4,838.99, as follows:


     Description of Item                       Amount

     Uniforms                              $  200.00
     Dry cleaning/laundry                   1,820.00
     Association dues                         285.00
     Professional dues                        375.00
     Range dues                               220.00
     Ammunition                               104.00
     Camera                                    49.99
     Guns                                     650.00
     Telephone (2nd line)                     485.00
     Telephone (cellular)                     650.00
       Total                               $4,838.99


     Petitioner gave explanations for all of the expenses listed

on the worksheet.    The dues were paid to the Fraternal Order of

Police, a firefighters union, and the Progressive Black

Firefighters.   The range dues and ammunition were unreimbursed

expenses petitioner incurred at a firing range in connection with

his occupation as a police officer.     Petitioner purchased the

camera to take pictures of crime scenes and to bolster his police

reports.   He also purchased his own weapon for police use, a .40

caliber Sig Sauer P-229 pistol.   The $485 telephone expense was
                                - 6 -


for a telephone line required in petitioner’s home by both the

police and fire departments.    The $650 cellular expense was for a

cellular telephone that he used in both jobs.

     The amount of expenses listed on the worksheet totaled

$1,761.01 less than the amount petitioner claimed on Schedule A

of his income tax return.   Petitioner testified that he also

incurred unreimbursed job-related expenses for socks and shoes,

belts, short pants, bed linen, and food, which accounts for the

difference between the $4,838.99 listed on the worksheet and the

$6,600 claimed on his return.

     With respect to the $485 claimed for the second telephone

line in petitioner's home and the $650 claimed for the cellular

telephone, petitioner maintained no contemporaneously prepared

records to document his employee-related uses of these devices.

At the time his return was under audit by respondent, petitioner

prepared a worksheet to support the claimed deductions.   Such

evidence does not suffice to satisfy the substantiation

requirements for use of the cellular telephone because a cellular

telephone is listed property under section 280F(d)(4)(A)(v).

Moreover, with respect to the second telephone line, the Court is

not bound to accept petitioner's uncorroborated or self-serving

testimony that the amount claimed related to his employee-related

use of that line, and that there was no personal use involved.

Petitioner, therefore, has failed to sustain his burden on that
                                - 7 -


item.   Respondent, therefore, is sustained on the claimed second

telephone and cellular telephone expenses.    Brodsky v.

Commissioner, T.C. Memo. 2001-240.

     With respect to the uniforms, dry cleaning and laundry,

association and professional dues, firing range expenses,

ammunition, camera, and gun expenses, the strict substantiation

rules do not apply, and the Court is satisfied that petitioner

did incur deductible expenses for these items.    Although

petitioner admitted he was “not the world’s best record-keeper,”

he testified credibly with respect to these items and their

business purpose.   In the absence of adequate substantiation,

this Court may, if convinced by the evidence, estimate the amount

of deductible expenses incurred.     Cohan v. Commissioner, 39 F.2d

540, 543-544 (2d Cir. 1930).   Therefore, under the Court's

discretionary authority pursuant to Cohan, the following amounts

are allowed as unreimbursed employee business expense deductions

on Schedule A:   Uniforms, $200; dry cleaning and laundering of

uniforms, $500; association and professional dues, $500; firing

range and ammunition costs, $100; firearm and camera, $200, for a

total of $1,500.    See McGovern v. Commissioner, 42 T.C. 1148

(1964) (expense for nurse’s uniforms allowed under Cohan rule),

affd. 17 AFTR2d 944, 66-1 USTC par. 9455 (6th Cir. 1966); Fisher

v. Commissioner, 23 T.C. 218 (1954) (purchase and laundering of

formal clothing expenses of professional musician allowed under
                                - 8 -


Cohan), affd. 230 F.2d 79 (7th Cir. 1956).    The Court declines to

allow any deduction for the claimed job-related expenses of socks

and shoes, belts, short pants, bed linen, and food because, under

section 262(a),    no deduction is allowed for personal, living, or

family expenses.   These items constitute personal expenses.

     With respect to the charitable contributions, section 170

allows a deduction for charitable contributions during the

taxable year, if verified as provided in the regulations.      Sec.

170(a)(1).   The charitable contributions deduction is subject to

certain substantiation requirements.    Sec. 170(f)(8).   No

deduction is allowed for any contribution of $250 or more unless

the taxpayer substantiates the contribution by a contemporaneous

written acknowledgment of the contribution by the qualified donee

organization.   Sec. 170(f)(8)(A).   The standards for record

keeping and return requirements for deductions for charitable

contributions are set forth in section 1.170A-13, Income Tax

Regs.   Under the applicable provisions, a taxpayer claiming a

charitable contribution deduction shall maintain for each

contribution one of the following:

     (i) A cancelled check.

     (ii) A receipt from the donee charitable organization
     showing the name of the donee, the date of the contribution,
     and the amount of the contribution. A letter or other
     communication from the donee charitable organization
     acknowledging receipt of a contribution and showing the date
                               - 9 -


     and amount of the contribution constitutes a receipt for
     purposes of this paragraph (a).

     (iii) In the absence of a canceled check or receipt from the
     donee charitable organization, other reliable written
     records showing the name of the donee, the date of the
     contribution, and the amount of the contribution.

Sec. 1.170A-13(a)(1)(i)-(iii), Income Tax Regs.   The reliability

of the written records described “is to be determined on the

basis of all of the facts and circumstances of a particular

case.”   Sec. 1.170A-13(a)(2)(i), Income Tax Regs.

     Petitioner did not present any canceled checks or credit

card receipts with respect to his 2001 charitable contributions,

and he had no record of the amount of his contribution to the

Salvation Army.   However, he did produce letters from Antioch

Baptist Church and Understanding for Life Ministries

acknowledging contributions by petitioner of $3,735 and $4,466,

respectively, in 2001.   These contributions total $8,201, and

exceed the $6,045 claimed on petitioner’s return.5   Petitioner

asked to have his contributions and evidence considered to the

fullest extent possible.   The Court is satisfied with the

credibility of petitioner’s testimony as verified by his

documentation under the cited legal standards and, therefore,

allows a charitable contribution deduction of $8,201 for the year

at issue.


     5
          Petitioner attributed the error to filing his tax
return in haste; he did not file an amended return.
                            - 10 -


    Reviewed and adopted as the report of the Small Tax Case

Division.



                                       Decision will be entered

                                  under Rule 155.
