In accordance with the principles for claiming deductions, the burden of proof is on a taxpayer when claiming business deductions under Section 162(a). However, a deduction is not denied for otherwise allowable business expenses where there is a failure of strict proof, i.e., records of expenses for certain transactions.
When proof of detail or itemization is lacking, automatic disallowance for business expenses is not the general rule.
This is due in large measure to the Cohan case,[1] where George M. Cohan spent substantial sums on his Broadway musicals, but kept no account of the expenditures. Despite inadequate records, he was allowed a deduction based on close approximations. Generally, the effect of the Cohan decision extends to the deductibility of business expenses where the taxpayer clearly incurred business expenses, but kept inadequate records.[2] Below are exceptions to the Cohan Rule and an example of how it is applied.
Exceptions to Cohan Rule
The Cohan rule has been abolished by statute for business expenses for travel, entertainment and gifts.[3] Approximations are not allowed for such expenses.
Reasonableness Standard
The Service and the courts agree that strict proof of otherwise deductible business expenses are not always available or attainable. In the words of the Cohan court, “it is “not fatal that the results will inevitably be speculative; many important decisions must be such.”
Where there is an evident right to a deduction but no showing of the exact amount, the court allows or determines an appropriate amount.[4] But the Court must have some basis for making an estimate of that amount.[5] However, where proof is lacking of any deductible item the Cohan rule is not applied.[6]
The Service should make as close an approximation as possible. However, the propriety of deductions will be heavily scrutinized when the inexactitude of records is of the taxpayer's making.[7]
There have been hundreds of administrative[8] and judicial decision[9]9 under which deductions for business expenses have been allowed on the basis of estimates rather than on written documents. The Cohan rule is a salutary one, both in permitting deductions based on intelligent estimates[10] reasonably determined and, at the same time, warning a taxpayer that carelessness in the keeping of records may be extremely costly.[11]
Procedures for Approximation
Where the Service has allowed part of a claimed deduction, the Tax Court will not alter the determination unless facts appear from which a different approximation can be made.[12] In this connection the lower court may not be compelled to estimate even though such an estimate, if made, might have been affirmed.[13] No estimate is allowed where the expenditure in question is made primarily for personal reasons.[14]
Evaluation Difficulties
In some cases a decision must be an approximation derived from an evaluation of elements not easily measured. In matters as practical as the administration of tax laws and in the decision of problems connected with them a high degree of precision is often impossible to achieve.[15] “It is not required that the plaintiff (the taxpayer) keep meticulously accurate records of such expenses or get receipts upon every occasion.”[16] A percentage factor, based on time spent on business matters and space used for business purposes has been applied to produce an allocation between business and personal use in such cases.[17]
Deduction Disallowed for Inadequate Information
Where proof is lacking of any deductible item the Cohan rule will not be applied.[18] If a taxpayer who has available administrative information as to material evidence in support of an allegedly allowable deduction refuses to name the recipients of alleged cash payments and fails to connect the payments with any specific purposes, the Service disallows such deductions for failure of proof.[19]
Where the records are so insufficient that there is no basis for estimating the amount of expenses, the principles articulated in the Cohan rule cannot be applied.[20]
Courts will not apply the Cohan rule that deductible expenses be approximated absent documentation where records are of the type which could easily have been produced, such as cancelled checks showing mortgage or tax payments. The present trend, while not to repudiate the Cohan rule entirely, is not to invoke it where the claimed but unsubstantiated deductions are of a sort for which the taxpayer could have and should have maintained the necessary records, or where documents to support deductions the taxpayers claim could easily have been produced.[21]
Example of Application of Cohan Rule
TP was an electrical subcontractor who claimed he was entitled to a deduction for estimated labor costs he paid in cash.[22] In demolishing the interior of an old theater TP was forced to employ day laborers to perform such work. The workers demanded to be paid in cash and TP found it difficult to keep an accounting of the payments. At the trial TP produced an estimate of labor costs for the years in issue.
The Court, finding that cash payments were in fact made, agreed an allowance for some amount was proper. However, the Court said estimates produced by TP were grossly overstated and documents produced to support the deductions were inadequate to substantiate the entire amount claimed. In applying the Cohan rule, TP was entitled to deduct estimated labor costs but the amount was slashed because the claim was based upon uncertainty and lack of substantiation. The Court bore heavily against TP who was responsible for the uncertainty and lack of substantiation.
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[1] Cohan v. Commissioner of Internal Revenue, 39 F.2d 540, 2 U.S. Tax Cas. (CCH) P 489, 8 A.F.T.R. (P-H) P 10552 (C.C.A. 2d Cir. 1930).
[2] See, e.g., Prokop v. C.I.R., 254 F.2d 544, 58-1 U.S. Tax Cas. (CCH) P 9430, 1 A.F.T.R.2d 1422 (7th Cir. 1958); Zeddies v. C.I.R., 264 F.2d 120, 59-1 U.S. Tax Cas. (CCH) P 9267, 3 A.F.T.R.2d 724 (7th Cir. 1959); Blassie v. C.I.R., T.C. Memo. 1966-252, T.C.M. (P-H) P 66252, 25 T.C.M. (CCH) 1291, 1966 WL 1043 (T.C. 1966), acquiescence recommended, 1967 WL 16239 (I.R.S. AOD 1967) and decision aff'd, 394 F.2d 628, 68-1 U.S. Tax Cas. (CCH) P 9390, 21 A.F.T.R.2d 1368 (8th Cir. 1968). The principle was also applied in the determination of the reasonableness of salaries. C.I.R. v. R.J. Reynolds Tobacco Co., 260 F.2d 9, 58-2 U.S. Tax Cas. (CCH) P 9867, 2 A.F.T.R.2d 5892 (4th Cir. 1958), noted in §§ 25E:1 et seq. See also Clark v. C.I.R., 266 F.2d 698, 59-1 U.S. Tax Cas. (CCH) P 9430, 3 A.F.T.R.2d 1333 (9th Cir. 1959), citing Mertens text.
[3] I.R.C. § 274(d). See §§ 25D:01 et seq. for a discussion of travel, entertainment and business gifts. Cohan v. Commissioner of Internal Revenue, 39 F.2d 540, 2 U.S. Tax Cas. (CCH) P 489, 8 A.F.T.R. (P-H) P 10552 (C.C.A. 2d Cir. 1930).
[4] See, e.g., Bodoglau v. C.I.R., 230 F.2d 336, 56-1 U.S. Tax Cas. (CCH) P 9312, 49 A.F.T.R. (P-H) P 244 (7th Cir. 1956); Latendresse v. C. I. R., 26 T.C. 318, 1956 WL 651 (T.C. 1956), aff'd, 243 F.2d 577, 57-1 U.S. Tax Cas. (CCH) P 9623, 51 A.F.T.R. (P-H) P 145 (7th Cir. 1957) and acq., 1957-2 C.B. 3.
[5] Vanicek v. C.I.R., 85 T.C. 731, 742, Tax Ct. Rep. (CCH) 42468, 1985 WL 15409 (1985), acquiescence recommended, AOD-1986-38, 1986 WL 376288 (I.R.S. AOD 1986) and acq., 1986-2 C.B.1; Hansen v. C.I.R., T.C. Memo. 1994-387, T.C.M. (RIA) P 94387, 68 T.C.M. (CCH) 392 (1994), aff'd, 68 F.3d 470, 95-2 U.S. Tax Cas. (CCH) P 50539, 76 A.F.T.R.2d 95-6742 (5th Cir. 1995). See also, Williams v. U.S., 245 F.2d 559, 57-2 U.S. Tax Cas. (CCH) P 9759, 51 A.F.T.R. (P-H) P 594 (5th Cir. 1957).
[6] Saffan v. C. I. R., T.C. Memo. 1957-184, T.C.M. (P-H) P 57184, 16 T.C.M. (CCH) 822, 1957 WL 802 (T.C. 1957); Schellenbarg v. C. I. R., 31 T.C. 1269, 1959 WL 1171 (T.C. 1959), acq., 1959-2 C.B. 3 and aff'd in part, remanded in part on other grounds, 283 F.2d 871, 60-2 U.S. Tax Cas. (CCH) P 9745, 6 A.F.T.R.2d 5727 (6th Cir. 1960). See also, Estate of Reinke v. C.I.R., T.C. Memo. 1993-197, T.C.M. (RIA) P 93197, 65 T.C.M. (CCH) 2570 (1993), aff'd, 46 F.3d 760, 95-1 U.S. Tax Cas. (CCH) P 50064, 75 A.F.T.R.2d 95-736 (8th Cir. 1995); Norgaard v. C.I.R., 939 F.2d 874, 879, 91-2 U.S. Tax Cas. (CCH) P 50378, 68 A.F.T.R.2d 91-5302 (9th Cir. 1991).
[7] Walet v. C. I. R., 31 T.C. 461, 1958 WL 935 (T.C. 1958), decision aff'd, 272 F.2d 694, 60-1 U.S. Tax Cas. (CCH) P 9121, 4 A.F.T.R.2d 5955 (5th Cir. 1959). The Second Circuit has pointed out that the decision of the Tax Court in the Cohan case was reversed only because the lower court found that the taxpayer had made some allowable expenditures, yet gave him credit for none. Chesbro v. C.I.R., 225 F.2d 674, 55-2 U.S. Tax Cas. (CCH) P 9602, 47 A.F.T.R. (P-H) P 1923 (2d Cir. 1955). The Cohan rule will not be relied upon where substantial amounts have been allowed and the taxpayer produced no evidence which would justify the court in increasing the allowances above those already granted by the Commissioner. Fihe v. C. I. R., T.C. Memo. 1956-139, T.C.M. (P-H) P 56139, 15 T.C.M. (CCH) 696, 1956 WL 398 (T.C. 1956). Cf. Poletti v. C.I.R., 330 F.2d 818, 64-1 U.S. Tax Cas. (CCH) P 9424, 13 A.F.T.R.2d 1252 (8th Cir. 1964).
[8] Though the Cohan rule is generally available only for the use of the courts, nevertheless the Commissioner has frequently appropriated the rule in his determination of a deficiency. See, Simon v. C. I. R., T.C. Memo. 1955-324, T.C.M. (P-H) P 55324, 14 T.C.M. (CCH) 1262, 1955 WL 445 (T.C. 1955); Embry's Estate v. Gray, 143 F. Supp. 603, 56-2 U.S. Tax Cas. (CCH) P 9893, 50 A.F.T.R. (P-H) P 158 (W.D. Ky. 1956).
[9] The following are only selected examples of the ever-increasing number of decisions citing or following the Cohan rule: Akron, Canton & Youngstown Railroad Co, 22 T.C. 648, 1954 WL 664 (T.C. 1954), nonacq., 1956-2 C.B. 4; Lipsitz v. C.I.R., 21 T.C. 917, 1954 WL 414 (T.C. 1954), aff'd, 220 F.2d 871, 55-1 U.S. Tax Cas. (CCH) P 9375, 47 A.F.T.R. (P-H) P 370 (4th Cir. 1955); Boston & M.R.R. v. C.I.R., 206 F.2d 617, 53-2 U.S. Tax Cas. (CCH) P 9516, 44 A.F.T.R. (P-H) P 303 (1st Cir. 1953); Waterman's Estate v. C.I.R., 195 F.2d 244, 52-1 U.S. Tax Cas. (CCH) P 9227, 41 A.F.T.R. (P-H) P 896 (2d Cir. 1952); C.I.R. v. Motch, 180 F.2d 859, 50-1 U.S. Tax Cas. (CCH) P 9239, 39 A.F.T.R. (P-H) P 140 (6th Cir. 1950); Mayes v. C.I.R., 21 T.C. 286, 1953 WL 189 (T.C. 1953), acq. 1954-1 C.B. 5; Biggs v. C.I.R., T.C. Memo. 1968-240, T.C.M. (P-H) P 68240, 27 T.C.M. (CCH) 1177, 1968 WL 878 (T.C. 1968), aff'd, 440 F.2d 1, 71-1 U.S. Tax Cas. (CCH) P 9306, 27 A.F.T.R.2d 71-952 (6th Cir. 1971); Kellner v. C.I.R., T.C. Memo. 1971-103, T.C.M. (P-H) P 71103, 30 T.C.M. (CCH) 448, 1971 WL 2195 (1971), acquiescence recommended, 1971 WL 29512 (I.R.S. AOD 1971) and judgment aff'd, 468 F.2d 627, 72-2 U.S. Tax Cas. (CCH) P 9741, 30 A.F.T.R.2d 72-5718 (2d Cir. 1972); Paal v. C.I.R., T.C. Memo. 1969-284, T.C.M. (P-H) P 69284, 28 T.C.M. (CCH) 1476, 1969 WL 1264 (T.C. 1969), decision aff'd, 450 F.2d 1108, 71-2 U.S. Tax Cas. (CCH) P 9757, 28 A.F.T.R.2d 71-6043 (9th Cir. 1971) and acquiescence recommended, 1972 WL 32940 (I.R.S. AOD 1972); Kellner v. C.I.R., T.C. Memo. 1976-72, T.C.M. (P-H) P 76072, 35 T.C.M. (CCH) 326, 1976 WL 3267 (1976), acquiescence recommended, 1976 WL 39478 (I.R.S. AOD 1976) and aff'd, 553 F.2d 93, 77-1 U.S. Tax Cas. (CCH) P 9236, 39 A.F.T.R.2d 77-893 (2d Cir. 1977). Applying the Cohan Rule, the Tax Court has held that the taxpayer may deduct estimated labor costs in demolishing the interior of an old theater for employing workers who demanded payment in cash. However, the Court slashed the amount claimed based upon the uncertainty and lack of substantiation of the amount in question by the taxpayer. Vaughn v. C.I.R., T.C. Memo. 1986-578, T.C.M. (P-H) P 86578, 52 T.C.M. (CCH) 1133, 1986 WL 21788 (1986).
[10] See, e.g., Flowers v. U.S., 57-1 U.S. Tax Cas. (CCH) P 9655, 52 A.F.T.R. (P-H) P 1383, 1957 WL 10778 (W.D. Pa. 1957); Thrower v. C.I.R., T.C. Memo. 1962-291, T.C.M. (P-H) P 62291, 21 T.C.M. (CCH) 1540, 1962 WL 500 (T.C. 1962), aff'd, 330 F.2d 614, 64-1 U.S. Tax Cas. (CCH) P 9415, 13 A.F.T.R.2d 1233 (5th Cir. 1964). Green v. Commissioner of Internal Revenue, 74 T.C. 1229, 1980 WL 4486 (1980), acquiescence recommended, AOD-1981-128, 1981 WL 176179 (I.R.S. AOD 1981), applied the Cohan rule to allow an approximation of the cost of special high protein foods and “special drugs” and diets to a taxpayer who sold her blood plasma on a regular basis.
[11] A taxpayer is not entitled to the application of the Cohan rule merely for the asking. Estate of Rosset v. C.I.R., T.C. Memo. 1954-241, T.C.M. (P-H) P 54346, 13 T.C.M. (CCH) 1193, 1954 WL 284 (T.C. 1954); Ryweck v. C.I.R., T.C.M. (P-H) P 54048, 13 T.C.M. (CCH) 131, 1954 WL 498 (T.C. 1954); Malbin v. C.I.R., T.C. Memo. 1954-121, T.C.M. (P-H) P 54227, 13 T.C.M. (CCH) 773, 1954 WL 254 (T.C. 1954); English v. C. I. R., T.C. Memo. 1956-254, T.C.M. (P-H) P 56254, 15 T.C.M. (CCH) 1305, 1956 WL 497 (T.C. 1956), decision rev'd on other grounds, 249 F.2d 432, 57-2 U.S. Tax Cas. (CCH) P 10059, 52 A.F.T.R. (P-H) P 883 (7th Cir. 1957). There is always room, however, for the policy of not being overly strict with the requirement of keeping absolutely accurate records, where there has been no willful evasion.
[12] See, e.g., Nowland v. C. I. R., T.C. Memo. 1956-72, T.C.M. (P-H) P 56072, 15 T.C.M. (CCH) 368, 1956 WL 858 (T.C. 1956), aff'd, 244 F.2d 450, 57-1 U.S. Tax Cas. (CCH) P 9684, 51 A.F.T.R. (P-H) P 423 (4th Cir. 1957); English v. C. I. R., T.C. Memo. 1956-254, T.C.M. (P-H) P 56254, 15 T.C.M. (CCH) 1305, 1956 WL 497 (T.C. 1956), decision rev'd on other grounds, 249 F.2d 432, 57-2 U.S. Tax Cas. (CCH) P 10059, 52 A.F.T.R. (P-H) P 883 (7th Cir. 1957); Park Sherman Co. v. U. S., 29 T.C. 175, 1957 WL 966 (T.C. 1957); Williams v. U.S., 245 F.2d 559, 57-2 U.S. Tax Cas. (CCH) P 9759, 51 A.F.T.R. (P-H) P 594 (5th Cir. 1957); Kelsey v. C.I.R., T.C. Memo. 1968-62, T.C.M. (P-H) P 68062, 27 T.C.M. (CCH) 337, 1968 WL 1180 (T.C. 1968); Dixo Co., Inc. v. C.I.R., T.C. Memo. 1968-133, T.C.M. (P-H) P 68133, 27 T.C.M. (CCH) 644, 1968 WL 848 (T.C. 1968), acquiescence recommended, 1969 WL 20992 (I.R.S. AOD 1969), citing Mertens text; Berkley Mach. Works & Foundry Co., Inc. v. C.I.R., T.C. Memo. 1968-278, T.C.M. (P-H) P 68278, 27 T.C.M. (CCH) 1487, 1968 WL 886 (T.C. 1968), aff'd, 422 F.2d 362, 70-1 U.S. Tax Cas. (CCH) P 9261, 25 A.F.T.R.2d 70-746 (4th Cir. 1970); McKissack v. C.I.R., T.C. Memo. 1969-105, T.C.M. (P-H) P 69105, 28 T.C.M. (CCH) 557, 1969 WL 1120 (T.C. 1969), where daily records were kept but the Court did not believe the records were accurate; Loos v. C.I.R., T.C. Memo. 1967-37, T.C.M. (P-H) P 67037, 26 T.C.M. (CCH) 183, 1967 WL 1073 (T.C. 1967), acquiescence recommended, 1967 WL 16192 (I.R.S. AOD 1967), where the taxpayer's records were allegedly stolen, the Commissioner's determination was upheld. That a witness had engaged in practices violative of Federal price controls is a factor properly to be considered in judging his credibility. Nothing in the Cohan doctrine holds to the contrary. Chesbro v. C.I.R., 225 F.2d 674, 55-2 U.S. Tax Cas. (CCH) P 9602, 47 A.F.T.R. (P-H) P 1923 (2d Cir. 1955); Nellis v. C.I.R., 232 F.2d 890, 56-1 U.S. Tax Cas. (CCH) P 9507, 49 A.F.T.R. (P-H) P 1014 (6th Cir. 1956).
[13] See Williams v. U.S., 245 F.2d 559, 57-2 U.S. Tax Cas. (CCH) P 9759, 51 A.F.T.R. (P-H) P 594 (5th Cir. 1957); C.I.R. v. R.J. Reynolds Tobacco Co., 260 F.2d 9, 58-2 U.S. Tax Cas. (CCH) P 9867, 2 A.F.T.R.2d 5892 (4th Cir. 1958); R.J. Reynolds Tobacco Co. v. U.S., 138 Ct. Cl. 1, 149 F. Supp. 889, 57-1 U.S. Tax Cas. (CCH) P 9555, 50 A.F.T.R. (P-H) P 2187 (1957); Oates v. C.I.R., 316 F.2d 56, 63-1 U.S. Tax Cas. (CCH) P 9426, 11 A.F.T.R.2d 1413 (8th Cir. 1963); Stein v. C.I.R., 322 F.2d 78, 63-2 U.S. Tax Cas. (CCH) P 9695, 12 A.F.T.R.2d 5545 (5th Cir. 1963). Furthermore, there is a somewhat greater burden of proof upon the taxpayer in a refund suit than in a Tax Court proceeding protesting a deficiency proposed by the Commissioner. See §§ 50:1 et seq. for discussion of the burden of proof in tax cases.
[14] Sutter v. C.I.R., 21 T.C. 170, 1953 WL 179 (T.C. 1953), acq. 1954-1 C.B. 6; Showell v. C.I.R., T.C. Memo. 1960-7, T.C.M. (P-H) P 60007, 19 T.C.M. (CCH) 30, 1960 WL 698 (T.C. 1960), decision aff'd, 286 F.2d 245, 61-1 U.S. Tax Cas. (CCH) P 9218, 7 A.F.T.R.2d 508 (9th Cir. 1961). The same rule is applicable where the expenditures were essentially capital in nature. Estate of Slater v. C.I.R., T.C. Memo. 1962-256, T.C.M. (P-H) P 62256, 21 T.C.M. (CCH) 1355, 1962 WL 546 (T.C. 1962).
[15] Helvering v. Safe Deposit & Trust Co. of Baltimore, 1942-1 C.B. 246, 316 U.S. 56, 62 S. Ct. 925, 86 L. Ed. 1266, 42-1 U.S. Tax Cas. (CCH) P 10167, 28 A.F.T.R. (P-H) P 1256, 139 A.L.R. 1513 (1942); Moran v. C. I. R., T.C. Memo. 1958-5, T.C.M. (P-H) P 58005, 17 T.C.M. (CCH) 18, 1958 WL 679 (T.C. 1958); Flowers v. U.S., 57-1 U.S. Tax Cas. (CCH) P 9655, 52 A.F.T.R. (P-H) P 1383, 1957 WL 10778 (W.D. Pa. 1957).
[16] Dauksch v. Busey, 125 F. Supp. 130, 54-2 U.S. Tax Cas. (CCH) P 9584, 46 A.F.T.R. (P-H) P 836 (S.D. Ohio 1954).
[17] Hoggard v. U.S., 67-2 U.S. Tax Cas. (CCH) P 9741, 20 A.F.T.R.2d 5805, 1967 WL 14736 (E.D. Va. 1967). See §§ 25G:1 et seq. for a discussion of allocation of expenses between business and personal use of a home.
[18] Saffan v. C. I. R., T.C. Memo. 1957-184, T.C.M. (P-H) P 57184, 16 T.C.M. (CCH) 822, 1957 WL 802 (T.C. 1957); Schellenbarg v. C. I. R., 31 T.C. 1269, 1959 WL 1171 (T.C. 1959), acq., 1959-2 C.B. 3 and aff'd in part, remanded in part on other grounds, 283 F.2d 871, 60-2 U.S. Tax Cas. (CCH) P 9745, 6 A.F.T.R.2d 5727 (6th Cir. 1960); Hannaford v. C.I.R., T.C. Memo. 1960-78, T.C.M. (P-H) P 60078, 19 T.C.M. (CCH) 409, 1960 WL 843 (T.C. 1960); Crowley v. C. I. R., 34 T.C. 333, 1960 WL 1206 (T.C. 1960), acq., 1961-2 C.B. 3. Cf. Cohan v. Commissioner of Internal Revenue, 39 F.2d 540, 544, 2 U.S. Tax Cas. (CCH) P 489, 8 A.F.T.R. (P-H) P 10552 (C.C.A. 2d Cir. 1930). Cohan v. Commissioner of Internal Revenue, 39 F.2d 540, 544, 2 U.S. Tax Cas. (CCH) P 489, 8 A.F.T.R. (P-H) P 10552 (C.C.A. 2d Cir. 1930).
[19] Rosenstein v. C.I.R., 32 T.C. 230, 1959 WL 997 (T.C. 1959), acq., 1959-2 C.B. 3. In the Rosenstein case, had the taxpayer desired he could have furnished the names of many of the recipients, at least in sufficient numbers to permit a check or verification. See also Appeal of National Concrete Co., 3 B.T.A. 777, 1926 WL 827 (B.T.A. 1926); Evens & Howard Fire Brick Co. v. C.I.R., 8 B.T.A. 867, 1927 WL 405 (B.T.A. 1927); O'Laughlin v. Helvering, 81 F.2d 269, 35-2 U.S. Tax Cas. (CCH) P 9685, 17 A.F.T.R. (P-H) P 210 (App. D.C. 1935); Greenfeld v. C.I.R., 165 F.2d 318, 48-1 U.S. Tax Cas. (CCH) P 9130, 36 A.F.T.R. (P-H) P 535 (C.C.A. 4th Cir. 1947); Birnbaum v. C I R, 117 F.2d 395, 41-1 U.S. Tax Cas. (CCH) P 9242, 26 A.F.T.R. (P-H) P 413 (C.C.A. 7th Cir. 1941).
[20] Recklitis v. C.I.R., 91 T.C. 874, Tax Ct. Rep. (CCH) 45154, Tax Ct. Rep. Dec. (P-H) 91.55, 1988 WL 116976 (1988).
[21] Lerch v. C.I.R., 877 F.2d 624, 89-1 U.S. Tax Cas. (CCH) P 9388, 64 A.F.T.R.2d 89-5085 (7th Cir. 1989).
[22] Vaughn v. C.I.R., T.C. Memo. 1986-578, T.C.M. (P-H) P 86578, 52 T.C.M. (CCH) 1133, 1986 WL 21788 (1986).