                  T.C. Summary Opinion 2002-65



                     UNITED STATES TAX COURT



            GEORGE A. & DELORES COOPER, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 23764-97S.             Filed May 31, 2002.



     George A. Cooper and Delores Cooper, pro sese.

     Jack T. Anagnostis, for respondent.



     DINAN, Special Trial Judge:    This case was heard pursuant to

the provisions of section 7463 of the Internal Revenue Code in

effect at the time the petition was filed.   The decision to be

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

should not be cited as authority.   Unless otherwise indicated,

subsequent section references are to the Internal Revenue Code in

effect for the years in issue.
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     Respondent determined deficiencies in petitioners’ Federal

income taxes of $4,819, $4,369, and $2,786 for the taxable years

1994, 1995, and 1996.

     The issues for decision are:        (1) Whether petitioners are

entitled to disallowed deductions for medical expenses,

charitable contributions, personal property taxes, and

miscellaneous itemized deduction expenses; and (2) whether

petitioners received unreported interest and dividend income.

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

The stipulations of fact and the attached exhibits are

incorporated herein by this reference.        Petitioners resided in

Willingboro, New Jersey, on the date the petition was filed in

this case.

     The first issue for decision is whether petitioners are

entitled to various disallowed deductions.          On their joint

Federal income tax returns, petitioners claimed deductions for

the following expenses for each respective year:

                                            1994        1995         1996

     Medical expenses                     $19,541     $19,647   $12,465
     Charitable contributions               2,985       3,026     2,142
     Misc. itemized deduction expenses      4,754       4,651     2,595
     Personal property taxes                3,759         764      -0-

In the statutory notice of deficiency, respondent disallowed all

of these deductions.     Respondent concedes that petitioners paid

employee business expenses of $705 in each year for purchases of

boots and safety glasses.
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     A taxpayer generally must keep records sufficient to

establish the amounts of the items reported on his Federal income

tax return.   Sec. 6001; sec. 1.6001-1(a), (e), Income Tax Regs.

However, in the event that a taxpayer establishes that a

deductible expense has been paid but that he is unable to

substantiate the precise amount, we generally may estimate the

amount of the deductible expense, bearing heavily against the

taxpayer whose inexactitude in substantiating the amount of the

expense is of his own making.    Cohan v. Commissioner, 39 F.2d

540, 543-544 (2d Cir. 1930).    We cannot estimate a deductible

expense, however, unless the taxpayer presents evidence

sufficient to provide some basis upon which an estimate may be

made.   Vanicek v. Commissioner, 85 T.C. 731, 743 (1985).

     Special substantiation rules exist for charitable

contributions:   A deduction for charitable contributions

generally is not allowed in the absence of written records.       Sec.

1.170A-13, Income Tax Regs; see also sec. 6001; sec. 1.6001-1(a),

(e), Income Tax Regs.   Specific requirements, which vary

according to the type and amount of the contributions, do not

need to be set out in detail here.

     Petitioners admit that they have no substantiating documents

for the various disallowed expense deductions.    Petitioners also

were unable to provide at trial any reliable details concerning

the payment of the expenses, other than with respect to the
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purchases of the boots and safety glasses.    Consequently, we

sustain respondent’s determination that petitioners are not

entitled to deductions for any of the other expenses.

Furthermore, petitioners are not entitled to deductions for the

employee business expenses conceded by respondent.    Employee

business expenses generally are allowed as deductions under

section 162(a).    However, such expenses are miscellaneous

itemized deductions and are allowed only to the extent that the

aggregate of all miscellaneous itemized deductions exceeds 2

percent of adjusted gross income.    See secs. 62, 63, 67.

Petitioners’ adjusted gross income was $68,797 in 1994, $68,865

in 1995, and $76,314 in 1996.    Petitioners were allowed no other

miscellaneous itemized deductions in any of the years in issue.

Thus, they are not entitled to any deduction for the yearly $705

expense because it does not exceed 2 percent of adjusted gross

income in any year.

       The second issue for decision is whether petitioners

received unreported interest and dividend income.    Respondent

determined that petitioners received unreported interest income

of $42 in 1994 and unreported dividend income of $80 in 1994 and

$91 in 1995.

       Gross income generally includes income from whatever source

derived, including interest and dividend income.    Sec. 61(a)(4),

(7).    Petitioners admit that they received but did not report the
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income reflected in the notice of deficiency.       Respondent’s

determination in this regard is sustained.

     Reviewed and adopted as the report of the Small Tax Case

Division.

     To reflect the foregoing,

                                         Decision will be entered

                                 for respondent.
