In Uncategorized on 03/14/2023 at 18:37

No, not the 1949 English crime film, nor the 1979 Little River Band’s number, nor even Sir Paul McCartney’s upcoming post-Beatles retrospective. This is the story of Thomas LaRonn Mitchell, T.C. Sum. Op. 2023-9, filed 3/14/23.

Tom LaRonn “… was employed by Dallas Independent School District (DISD) and Liberty Mutual Group, Inc. (Liberty), as a school counselor and an insurance salesman, respectively. He worked a 40-hour week between those two jobs. He also performed ‘business consultant’ activities that he reported on Schedule C attached to his [year at issue] Form 1040, U.S. Individual Income Tax Return. Mr. Mitchell described his ‘business consultant’ activities as ‘artist development,’ ‘studio production consultation,’ ‘performance consultation,’ and ‘business consultation’ in connection with managing gospel and R&B artists. Mr. Mitchell did not report any income from his Schedule C business for the year in issue.” T. C. Sum. Op. 2023-9, at p. 2.

But Tom LaRonn had business expenses from the Sched C  that threw him for a $49K loss, wiping out his taxable income from his counseling-insurance selling gigs.

STJ Adam B (“Sport”) Landy drew this case, and Tom LaRonn’s $22K of vehicle expenses took center stage. Tom proffered a logbook showing “… a beginning odometer reading on January 1, 2018, of 50,000 miles and an ending odometer reading of 132,205 miles on August 1, 2018. Mr. Mitchell claimed that all miles listed were driven for business purposes.” T.C. Sum. Op. 2023-9, at p. 4

“To discredit the mileage log and refute the starting mileage of 50,000, respondent offered copies of Mr. Mitchell’s Texas vehicle inspection reports dated October 20, 2017, and November 15, 2018, providing the odometer readings for his vehicle of 182,291 and 204,107, respectively. According to the inspection reports between October 20, 2017, and November 15, 2018, 21,816 miles were driven on the vehicle, far less than the driven miles shown on the mileage log. Mr. Mitchell failed to explain or refute the inconsistencies.” T. C. Sum. Op. 2023-9, at p. 5.

Tom LaRonn also had receipts for travel expenses. They only made matters worse.

“Additionally, there were inconsistencies between the mileage log and the hotel receipts Mr. Mitchell provided. One receipt stated that Mr.  Mitchell stayed in Houston, Texas, on June 15, 2018, but the mileage log showed that he was in Charlotte, North Carolina, from June 15 through 20, 2018. Similarly, Mr. Mitchell provided another receipt showing that he stayed in Miami, Florida, on July 10, 2018, but the mileage log showed that he was in Dallas, Texas, from July 8 through 15, 2018. Mr. Mitchell claimed that the discrepancies were due to his artist-clients driving his vehicle for business purposes even though he was not present in the vehicle. We are not bound to accept a taxpayer’s self-serving, unverified, and undocumented testimony. Mr. Mitchell’s testimony is not credible, and the Court finds that no mileage was incurred for a business purpose.” T. C. Sum. Op. 9, at p. 5. (Citations omitted).

Takeaway- If you’re going to be on the run, make sure your paperwork runs with you.


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