Monday, September 13, 2010

Tax Court Denies Prof's Claimed Deductions for Research

Recently the U.S. Tax Court denied a math professor from The City University of New York an education related tax deduction. The professor attempted to write off $15,397 in expenses related to research and writing activities. However, the judge felt he failed to adequately substantiate his deductions. Check out the following snippet of the ruling courtesy of the Tax Prof Blog, or click here for a PDF of the court’s ruling.

Petitioner has, potentially, two trades or businesses. He is employed as a professor of mathematics, and he is engaged in research and writing on mathematical issues. He "wears two hats" but the "hats" are so similar in appearance that it is difficult to tell the difference between them. Because of this circumstance, it is particularly important that petitioner distinguish his research and writing activity from his activity as college professor as well as from his personal activities. ...

Petitioner's testimony is reasonable; however, he has failed to provide the Court with any adequate records or sufficient evidence to corroborate his own testimony. ... Petitioner has failed to show that he is entitled to Schedule C deductions in excess of those respondent allowed. Because petitioner has failed to adequately substantiate his deductions, the Court need not address the profit objective, trade or business, and startup issues respondent raised in his pretrial memorandum.

Shpilrain v. Commissioner, T.C. Summ. Op. 2010-133 (Sept. 9, 2010).

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