Case: PayPal Receipts Not Enough to Substantiate Business Deductions (T.C. Summ.) (IRC §162)

PayPal receipts inadequate to substantiate a taxpayer’s claimed business expenses, the U.S. Tax Court held in a nonprecedential summary opinion. The IRS disallowed Schedule C deductions that Taxpayer claimed for the years in issue including those for advertising expenses, depreciation and amortization expenses, legal and professional expenses, and “Other” expenses. Taxpayer was unable to produce invoices, receipts, or similar records to substantiate most of the expenses in question. After careful review of Taxpayer’s the business records produced at trial, consisting primarily of PayPal receipts, Taxpayer failed to prove adequate substantiation for any expenses in excess of the items the IRS ...