Richard Steel and Lucy Knight Steel v. Commissioner of Internal Revenue

Attorney Richard Steel and his wife, Lucy, 1 filed a joint income tax return for the year 1964 in which they claimed a business deduction in the amount of $4,850.21 for entertaining Richard’s clients and other guests 2 in their Manhattan apartment and a business deduction of $306.19 for the cost of air travel between New York and New Orleans and the cost of food, lodging, and miscellaneous expenses incurred. The Commissioner disallowed the entertainment expense because neither the taxpayer nor his wife kept any expense accounting, cancelled checks, receipts or other documentary evidence by…