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Guinn v. Dep't of Revenue4/19/2005
t disagrees with Guinn that it would be a "common or frequent occurrence" for someone in Guinn's same situation to use a branch library similar in size to the Vancouver Public Library for research when the largest main library in the immediate area is located in downtown Portland, a distance closer to his work and home and within the same state. Roelli at 258. Further, the expenses incurred in traveling to Vancouver, Washington, from Tualatin, Oregon, are not "reasonable in amount" compared to other available alternatives for the same activities, i.e., research and mailing. Id. Having failed to meet both required criteria, ordinary and necessary, the court agrees with Defendant that the mileage Plaintiffs claimed for travel to Vancouver, Washington, is not an allowable business expense.
After comparing Guinn's 1999 handwritten vehicle use/mileage log to his typed log, the court concludes that some of the use of Guinn's personal vehicle qualifies as a business expense. (Ptfs' Ex Item 2A; Def's Exs B-16 to 18.) For example, Guinn's trips to meet with his publisher in February 1999, June 1999, and August 1999 are allowed. Other trips to print book materials or travel to and from the airport for a business trip are allowed. However, mileage claimed for trips to meet with Guinn's attorney is, as will be discussed later, personal, not business. As previously discussed, Guinn's mileage expense for trips to Vancouver, Washington, do not meet the ordinary and necessary requirements to qualify as a business expense. In sum, the court concludes that Plaintiffs can claim 1,543 miles as a business expense for tax year 1999.
C. Other Expenses
For tax year 1999, Plaintiffs claimed subscriptions, bank fees, and a city application fee for an alarm system as business expenses. (Def's Ex A-2.) At trial, Guinn testified that, during 1999, the bank fees were incurred for stop payments made on checks written by his ex-wife. He testified those fees related to expenses for the production of income. Guinn testified that he only claimed a business expense for a subscription to The Oregonian during the time he was writing the book. He stated that, " taying up on local events was a critical piece in writing the book and making it as current and relevant to the present as possible." (Guinn's letter at 2, Jan 16, 2005.) With respect to the city application fee, Thompson testified that even if he concluded it was a business expense, the deduction would be limited under IRC 280A, business use of the home.
For tax year 2000, Plaintiffs claimed bank fees in the amount of $93.00. The auditor determined that the bank fees were paid to obtain a "home equity line of credit." (Def's Ex C-39 and C-57.) Defendant concluded that those expenses were personal.
The court concludes that there is no provision in the law to support Plaintiffs' claim that the bank fees are a qualified business expense. For tax year 1999, Plaintiffs' itemized category report states that $72.50 of the claimed deduction was an annual fee and upgrade fee paid to U.S. Bank. (Def's Ex C-29.) Plaintiffs did not provide evidence to show that the U.S. Bank account was available for business, rather than personal use. The balance of the deduction for bank fees appears to be for stop payments on checks written by Guinn's ex-wife. Those charges were incurred by Guinn for a personal reason and cannot be deducted as an ordinary and necessary business expense. For tax year 2000, the bank fees paid to obtain a home equity loan are personal and are not an allowable business deduction. The alarm fee is not allowable business expense and, as Defendant stated, even if it was allowed, the deduction would be limited and would not reduce Plaint
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