Matthew J. Nasuti v. Commissioner of Revenue (October 5, 2015)

COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD



MATTHEW J. NASUTI		    v.	     COMMISSIONER OF REVENUE
					
Docket No. C310460			 	     Promulgated:
							   	October 5, 2015

This is an appeal filed under the formal procedure pursuant to G.L. c. 58A, § 7 and G.L. c. 62C, § 39, from the refusal of the Commissioner of Revenue ("appellee" or "Commissioner"), to abate personal income tax, together with interest and penalties, assessed to the appellant, Matthew J. Nasuti for tax years 2006, 2007 and 2008  ("tax years at issue").
Commissioner Scharaffa heard this appeal and was joined by Chairman Hammond and Commissioners Rose, Chmielinski and Good in the Revised Decision for the appellant for tax year 2007 and for the appellee for tax years 2006 and 2008.  
	These findings of fact and report are made pursuant to a request by the appellant under G.L. c. 58A, § 13 and 831 CMR 1.32.

Matthew J. Nasuti, pro se, for the appellant.
	
Matthew F. Cammarata, Esq., and John DeLosa, Esq. for the appellee. 


FINDINGS OF FACT AND REPORT
	On the basis of the exhibits and testimony offered into evidence at the hearing of this appeal, the Appellate Tax Board ("Board") made the following findings of fact.
At all times relevant to this appeal, the appellant was a Massachusetts resident required to file a resident income tax return ("Mass. Return").  The pertinent jurisdictional facts for each tax year are as follows.   
Jurisdiction
The appellant timely filed a Mass. Return for each of the tax years at issue.  For tax year 2006, the Commissioner issued a Notice of Assessment ("NOA") dated April 6, 2010, assessing to the appellant tax in the amount of $190.80.  The appellant subsequently filed a timely abatement application, which the Commissioner denied by a notice of abatement determination dated December 17, 2010.
The Commissioner issued to the appellant an NOA dated February 2, 2011, assessing tax in the amount of $1,918.78 plus interest for tax year 2007 and $620.79 plus interest for tax year 2008.  
The appellant filed his Petition Under Formal Procedure ("Petition") with the Board for all tax years at issue on February 11, 2011.  The appellant subsequently filed a timely abatement application for tax years 2007 and 2008 on October 18, 2011, which the Commissioner denied by notice of abatement determination dated October 28, 2011.  Although the appellant filed his Petition prior to filing his abatement application for tax years 2007 and 2008, the Board found and ruled, as detailed in the Opinion, that the Board had jurisdiction over this appeal.
Substantive issues
Tax Year 2006
On his Mass. Return for 2006, the appellant reported $2,843 in total taxable income and $92.00 in tax due.  He claimed a $3,600 exemption for one dependent, his 80-year-old mother.  The appellant did not claim his mother as a dependent on his federal Form 1040 ("Federal Return").   
At the hearing of this appeal before the Board, the appellant presented no evidence supporting his claim for the dependent-care exemption, including evidence relating to his mother's gross income or evidence establishing that the appellant provided support for her during the year.  In the absence of such evidence, the Board found and ruled that the appellant failed to prove that his mother was his dependent during tax year 2006. 
Tax Year 2007
On his Mass. Return for 2007, the appellant claimed a $10,799 business loss against his taxable income.  According to his Federal Return Schedule C, the appellant, who is an attorney, claimed numerous expenses attributed to his law practice.  During the tax years at issue, the appellant was admitted to practice in the State of California and in federal courts.  The claimed expenses included: rent for office space in Greenfield; travel; meals; office supplies; and "other" related expenses, for a total of $15,695.03, which he claimed against his Schedule C gross receipts of $4,896.
The majority of the claimed Schedule C travel and meal expenses resulted from the appellant's trips to Spain and Peru during 2007 for the stated purpose of learning Spanish through immersion courses.  The appellant's claimed business purpose for these trips was that, generally speaking, the ability to speak Spanish would be beneficial to his law practice.  
The appellant also traveled to a federal court in Ohio during 2007 for oral arguments on behalf of a client, RSR Corporation.  The appellant reported $4,896 in income received by the Law Office of Matthew Nasuti from RSR Corporation on his Mass. Return for 2007.      
Upon audit of his 2007 taxes, the auditor rejected the appellant's $15,695.03 Schedule C deduction for 2007, citing the appellant's failure to submit documentation substantiating the claimed business expenses.  The appellant had claimed that he could not afford to make copies of the voluminous records in his possession.  On May 14, 2012, the Board issued an Order stating, "The parties are ordered to review the appellant's books and reco[r]ds to determine whether there is adequate substantiation for the disputed items."  The Commissioner accordingly made copies of and reviewed the appellant's records, at no expense to the appellant.  These records consisted of copies of personal credit card statements, retailer receipts (some with handwritten notations), personal checks, and handwritten statements.  The appellant contended, however, that the Board's Order had prescribed a "field audit" wherein an auditor reviews the appellant's records together with the appellant, not a "desk audit" wherein the auditor reviews the records without the appellant present.  The Board found that the Order did not prescribe a field audit.  Moreover, the documents furnished to the Commissioner and offered into evidence provided sufficient proof for the Board to make its determination of which expenses were deductible.
The Commissioner rejected all of the appellant's business expenses, contending that the appellant failed to prove: (1) that he was engaged in a regular trade or business of the practice of law; and (2) that his expenses were related to his business as opposed to personal expenses.  However, the Board disagreed with the Commissioner's determination.  Instead, the Board found evidence sufficient to establish that the appellant was engaged in the business of practicing law, namely that: the appellant was paying regular monthly rental payments during 2007 for the lease of office space in Greenfield; he had court and travel expenses demonstrating that he performed work for a client at the federal court in Ohio; and he received income from the client, RSR Corporation.  Based on the evidence of record for 2007, the Board found that the appellant was engaged in the business of practicing law.  This trade or business entitled the appellant to claim expenses directly related to his practice of law and for which he could provide substantiation.  
The Board further found that the appellant substantiated and was entitled to a total of $6,693.62 in expenses for items including: the lease of office space in Greenfield; office supplies; travel related to his appearance in a federal court in Ohio for a hearing on behalf of RSR Corporation; bar admittance dues; reference books; and court filing fees.  These expenses resulted in a business loss of $1,798.00, as opposed to the appellant's claimed loss of $10,799.00. 
The Board found that the remaining business expenses claimed by the appellant were not related to the appellant's business of practicing law.  In particular, the Board found that the appellant's travel expenses to Spain and Peru for a Spanish-immersion endeavor were not business expenses.  While the appellant contended that he wished to expand his practice to include clients who spoke languages other than English, this desire was not sufficient to create an actual business link between his law practice and the expense, particularly because the appellant did not establish that the expenses were directly related to maintaining or improving skills required of him in his law practice.  Moreover, even if he had demonstrated a particular need to learn to speak Spanish, the appellant failed to prove that trips to Spain and Peru were an ordinary and necessary means for him to learn the language.  The Board thus determined that the travel expenses were personal in nature and thus non-deductible. 
Finally, the appellant reported taxable income of $28,482 from an early distribution from the appellant's Individual Retirement Account ("IRA") for tax year 2007.  However, the Commissioner determined that the actual amount of the IRA distribution was $48,481.  The appellant proffered no evidence to refute the Commissioner's determination.  The Board therefore upheld this portion of the Commissioner's assessment.
Tax Year 2008
On March 13, 2008, the appellant was hired by the United States Department of State ("State Department") pursuant to 5 U.S.C. § 3161 as a Senior City Management Advisor of the Iraq Transition Assistance Office.  On March 28, 2008, the State Department terminated the appellant's employment after an argument between the appellant and one of his training officers.  The appellant claims that his termination was unlawful.  
On his Mass. Return for tax year 2008, the appellant reported a $9,965 business loss against his income of $4,353 in wages and $12,305 in pension and annuity distributions.  On his Mass. Return Schedule C, the appellant again attributed his business expenses to the Law Office of Matthew Nasuti, but this time he listed the address as 138 Lower Road in Deerfield, Massachusetts.  The claimed expenses, totaling $9,965, included: supplies; utilities; and other expenses, the bulk of which were related to the cost of a computer and printer that the appellant purchased on March 8, 2008.  However, unlike tax year 2007, the appellant did not report any gross receipts for the Law Office of Matthew Nasuti or rental payments on his Schedule C.  Instead, he claimed the entire $9,965 of expenses as a Schedule C loss against his taxable income.  
Based on the evidence of record, which noticeably did not include any gross receipts from the appellant's law practice or rental payments for office space or expenses that could be directly tied to his practice of law, the Board found the evidence insufficient to establish that the appellant was actually engaged in the practice of operating his law practice during 2008.  Therefore, the Board denied each of the appellant's claimed Schedule C expenses and the net Schedule C loss.
The appellant also included with his Mass. Return for 2008 a Massachusetts Schedule Y, relating to "allowable employee business expenses."  Contending that his termination from the State Department was unlawful, the appellant claimed that he was entitled to deduct all unreimbursed employee business expenses incurred by him from March 13, 2008 through December 31, 2008.  The appellant submitted receipts for a total of $37,403 in unreimbursed employee business expenses for the following:  travel; lodging; meals; clothing; language books and courses; and miscellaneous expenses.  The appellant never claimed to be an outside salesperson, and the evidence of record failed to establish that he was one.  Therefore, as will be explained further in the following Opinion, the appellant's employee business expenses, if any, were limited to substantiated expenses for travel, meals and lodging while working away from home, including transportation costs incurred in connection with the performance of his services as an employee, but not including commuting expenses.  The appellant's potentially allowable expenses amounted to just $3,528.29 of his originally claimed $37,403.  Of this potentially allowable amount, the Board found that the appellant failed to establish whether the appellant was entitled to reimbursement from his employer for these expenses.  
Finally, on his 2008 Mass. Return, the appellant reported $12,305 in 1099-R taxable income from an IRA distribution.  The Commissioner, however, determined that the actual IRA distributions for that year totaled $19,030.  Moreover, on his Petition, the appellant claimed that the IRA distribution was not voluntary but made out of necessity because he was unable to secure employment after his supposed unlawful termination.  Alternatively, he claimed that the distribution was an employee expense, contending that, because he was not being paid for the job from which he was allegedly illegally fired, he was compelled to make IRA withdrawals to support himself.  As detailed in the following Opinion, however, the appellant has raised no statutory or other basis to justify the exclusion of the early IRA distribution from his taxable income.  The appellant also did not proffer any evidence contesting the amount of the IRA distribution.  The Board, therefore, upheld this portion of the Commissioner's assessment.
Accordingly, the Board issued a Revised Decision for the appellee for tax years 2006 and 2008 and for the appellant abating $1,438.78 in tax, plus statutory additions, for tax year 2007. 

OPINION
Massachusetts adjusted gross income includes some but not all of the deductions allowable under the Internal Revenue Code ("Code").  G.L. c. 62, § 2(d).  "Deductions are to a large extent a matter of legislative grace.  The burden is on a taxpayer seeking a deduction to point to a particular statutory provision which authorizes the deduction."  Drapkin v. Commissioner of Revenue, 420 Mass. 333, 343 (1995). 
 
1. The Board's jurisdiction to hear this appeal.
Although the appellant filed this appeal within the sixty-day period of the denial of his tax year 2006 abatement application as prescribed by G.L. c. 62C, § 39, he filed his Petition with the Board prior to the Commissioner's issuance of the notice of abatement determination for tax years 2007 and 2008.  The Supreme Judicial Court has held that a taxpayer's premature filing of an abatement application is not fatal to the Board's jurisdiction, reasoning that "[i]t is well settled in similar cases, where a statute required action within a certain time 'after' an event, that the action may be taken before that event," because deadline statutes "have been construed as fixing the latest, but not the earliest, time for the taking of the action."  Becton, Dickinson and Company v. State Tax Comm'n, 374 Mass. 230, 234 (1978) (citing Tanzilli v. Casassa, 324 Mass. 113, 115 (1949)).  The Supreme Judicial Court further recognizes that "valuable rights" to appeal should not be lost by acting too soon, as opposed to too late.  Id.  The Board has likewise ruled that a premature filing of a Petition did not deprive the Board of jurisdiction to hear and decide an appeal.  Stanley Home Products, Inc. v. Commissioner of Revenue, Mass. ATB Findings of Fact and Reports 1986-128, 136.  In the instant appeal, the Board accordingly found and ruled that the premature filing of the appellant's Petition was not fatal to the Board's jurisdiction over tax years 2007 and 2008 and that it had jurisdiction over all the tax years at issue. 

2.  Substantive tax issues
a.  Tax Year 2006
Dependent care deduction
The issue raised by the appellant for tax year 2006 was his entitlement to claim his mother as a dependent, an issue not present in the other tax years at issue, because he did not claim her as a dependent in tax years 2007 or 2008.            G. L. c. 62, § 3B(a)(8), as in effect during 2006, provides that an individual taxpayer's adjusted gross income shall be reduced by $3,600 if that individual maintains a household which includes one member who is "(i) aged 65 or older, or who [is] disabled, and (ii) who qualif[ies] as a dependent under section 152 of the Code."  A "qualifying relative" of a taxpayer qualifies as a dependent under Code § 152(d) if that individual: (1) bears a particular relationship to the taxpayer, including a mother; (2) has gross income for the calendar year less than the exemption amount provided in Code § 151(d); and (3) receives over one-half of her support for the calendar year from the taxpayer. 
The appellant, however, presented no specific evidence regarding his mother's income or the amount of support that he provided her aside from his unsupported and general testimony.  With no documentary or reliable evidence of income or support, the Board found and ruled that the appellant failed to meet his burden of establishing his entitlement to claim his mother as his dependent for tax year 2006.  
b.   Tax year 2007
The primary issues raised in 2007 are whether: (i) the Commissioner was required to perform a field audit; (ii) the appellant was entitled to the trade or business expense deduction on his Schedule C; and (iii) the appellant's early IRA distribution was subject to tax.

Desk versus field audit
While the appellant claimed that the Commissioner erred by performing a desk audit as opposed to a field audit, the Board's Order did not require a field audit, and there is no statutory or other authority prescribing one audit method over the other.  In Jones v. Commissioner of Revenue, Mass. ATB Findings of Fact and Reports 2011-854, the Board ruled that the auditor assigned to the taxpayer's case erred when she conducted neither a desk audit nor a field audit, but instead "summarily deemed the appellant's records to be inadequate."  Id. at 2011-893.  By contrast, the auditors in the present appeal, upon order of the Board, copied and reviewed the appellant's records and in fact assembled a substantial audit file for submission to the Board as evidence.  From this substantial file, the Board, as the trier of fact, was able to determine the nature of the expenses claimed and whether the supporting documentation was sufficient to substantiate the appellant's deduction.  Accordingly, the Board perceived no error in the audit of the appellant for tax year 2007.
Schedule C expenses for appellant's law practice
Massachusetts adopts the deductions allowed in Code § 62, with certain modifications not relevant to these appeals.  See G.L. c. 62, § 2(d)(1).  Code § 62(a)(1) provides for "deductions allowed by this chapter (other than by [Code §§ 211 - 224]) which are attributable to a trade or business carried on by the taxpayer."  Therefore, Massachusetts adopts the deductions allowed under Code §§ 161 through 199 which are attributable to a trade or business.  In particular, Code § 162(a) allows a deduction for "all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business."  As a deduction allowed under Code §§ 62(a)(1) and 162(a), the trade or business deduction is in turn allowed to arrive at Massachusetts Part B adjusted gross income under G.L. c. 62, § 2(d)(1).  Accordingly, a Massachusetts taxpayer may deduct all ordinary and necessary expenses paid or incurred in carrying on a trade or business.
 "Trade and business deductions" are defined at Code § 62(a)(1) as those "which are attributable to a trade or business carried on by the taxpayer, if such trade or business does not consist of the performance of services by the taxpayer as an employee" (with certain limited exceptions in Code § 62(a)(2)).  A taxpayer must show a number of elements of proof to claim deductions related to the conduct of a "trade or business."  As the United States Supreme Court has stated, "The income tax law, almost from the beginning, has distinguished between a business or trade, on the one hand, and 'transactions entered into for profit but not connected with . . . business or trade.'" Commissioner v. Groetzinger, 480 U.S. 23, 35 (1987) (citations omitted).  In Commissioner v. Groetzinger, 480 U.S. 23, 35 (1987), the Court held that "to be engaged in a trade or business, the taxpayer must be involved in the activity with continuity and regularity and that the taxpayer's primary purpose for engaging in the activity must be for income or profit."  The distinction between a trade or business and an activity entered into for profit is crucial under Massachusetts tax law, because Massachusetts has not adopted Code § 212, which allows a deduction for expenses paid or incurred for the production or collection of income, even though not connected with a trade or business.  Therefore, Massachusetts taxpayers must meet the burden of proving that their claimed expenses are connected with an actual trade or business, not merely an activity engaged in with the intent of earning income.  See Jones, Mass. ATB Findings of Fact and Reports at 882-83.
In the instant appeal, the Board found and ruled that, during tax year 2007, the appellant demonstrated a sufficient continuity and regularity of business activity, and a primary purpose of gaining income, to constitute a trade or business.  The facts of the instant appeal are distinguishable from those of Devine v. Commissioner of Revenue, Mass. ATB Findings of Fact and Reports 2012-821, 839, where the appellant was vague in his description of his "consulting" business: "Many of the appellant's examples of his services consisted of providing unsolicited or 'informal' advice, on a wide variety of topics for which he did not produce any licenses or other formal training, on an ad hoc as opposed to regular basis, and often admittedly pro bono."  By contrast, the appellant here submitted evidence of payment of fees consistent with the practice of law (bar dues to the State of California and court fees) and receipts demonstrating that he was performing work (office supplies and expenses for travel to Ohio for arguments), as well as statements of compensation from at least one paying client, RSR Corporation.  The Board found this evidence sufficient to demonstrate that the appellant pursued his practice of law on a regular and consistent basis for the purpose of deriving income and profit during tax year 2007.
Furthermore, the Board found that the documentation submitted was sufficient to prove the amounts and the business nature of many, but not all, of his claimed expenses.  The Board found documentation to prove a total of $6,693.62 in expenses for items including but not limited to: lease of office space; office supplies; travel expenses related to his appearance in an Ohio court on behalf of a client; a meal incurred during the travel to Ohio; bar dues; reference books; and court filing fees.  
The Board, however, found that the appellant failed to demonstrate how many of the remaining expenses, particularly his travel to Spain and Peru for Spanish language-immersion programs, were ordinary and necessary for the appellant's business of practicing law.  The appellant did not establish that the expenses were directly related to maintaining or improving skills required of him in his law practice.  Contrast, Ford v. Comm'r of Internal Revenue, 56 T.C. 1300, 1304 (U.S. Tax Ct., 1971), aff'd, 487 F.2d 1025 (9th Cir. 1973); Furner v. Commissioner, 393 F.2d 292 (7th Cir., 1968).  Moreover, even if he had proved that knowledge of Spanish was a necessity for his trade or business, the appellant offered no evidence suggesting that travel abroad for immersion programs were an ordinary or necessary means of learning Spanish.  The appellant bears the burden of proving his right as a matter of law to an abatement.  See M & T Charters, Inc. v. Commissioner of Revenue, 404 Mass. 137, 140 (1989); Stone v. State Tax Commission, 363 Mass. 64, 65-66 (1973); Staples v. Commissioner of Corps. and Taxation, 305 Mass. 20, 26 (1940).  The Board here found and ruled that the appellant failed to meet his burden of proving that expenses in excess of $6,693.62, including those related to travel to Spain and Peru, were an ordinary and necessary expense for his business.  Accordingly, the Board upheld this portion of the Commissioner's assessment.


Early IRA distribution
While the appellant reported a taxable income of $28,482 from an early distribution from his IRA, the Commissioner determined on audit that the actual amount of the distribution was $48,481.  The appellant proffered no evidence to contest this determination.  The Board therefore ruled that the appellant failed to meet his burden of proof and upheld this portion of the Commissioner's assessment.  Staples, 305 Mass. at 26.  
c.   Tax year 2008 
The issues raised for tax year 2008 are whether: (1) the appellant was engaged in a trade or business; (2) the appellant had deductible employee business expenses; and (3) the appellant could exclude from income his early IRA distributions.
	i. Schedule C expenses claimed by the appellant
Unlike the evidence for tax year 2007, the evidence for tax year 2008 did not include any indication that the appellant was actually engaged in the trade or business of practicing law.  Notably absent in tax year 2008 was any evidence of rent for office space or payments from any clients for any work he had performed during the tax year or receipts relating to specific client work, as he had submitted in the previous tax year for his trip to Ohio for oral arguments before a federal court.  The Board found that the mere submission of numerous receipts for general expenses, without any proof of actual legal work being performed, was not sufficient to establish that the appellant was engaged in a trade or business of operating his law practice.  E.g., McLaughlin v. Commissioner of Revenue, Mass. ATB Findings of Fact and Reports 2005-538, 554 (finding that the taxpayer failed to establish the existence of a trade or business when he "did not tell the Board what it is [he] did in 1998-2001, where, how often, and for whom.").  Accordingly, the Board upheld the portion of the Commissioner's assessment related to the denial of the appellant's Schedule C business deductions.
Unreimbursed employee business expenses
In addition to his claimed Schedule C expenses associated with his purported trade or business of pursuing a law practice, the appellant also claimed expenses associated with his employment with the State Department.  General Laws c. 62, § 2(d)(2) allows deduction of: (i) expenses for travel, meals and lodging incurred by the employee while away from home, and (ii) all federally deductible employee business expenses incurred by an employee "if such trade or business is to solicit, away from the employer's place of business, business for the employer."  The § 2(d)(2)(ii) category of taxpayer is commonly referred to as an "outside salesperson."  Department of Revenue Directive 89-1 (citing Code § 162, Code § 67, and G.L. c. 62, § 2(d)(2)).  The appellant made no claim of being an outside salesman, and the Board found that he was not.  Therefore, the appellant's employee business expenses, if any, were governed by § 2(d)(2)(i) and thus limited to substantiated amounts for travel, meals, and lodging while working away from home, including transportation costs incurred in connection with the performance of his services, but not including commuting expenses.  G.L. c. 62, § 2(d)(2)(i).  These restrictions reduced the appellant's potentially allowable expenses to $3,528.29 of his originally claimed $37,403. 
Moreover, leaving aside the issue of whether the appellant was still employed with the State Department after his allegedly unlawful termination and whether the claimed expenses were incurred while he was an employee, the appellant faces another challenge: "the scope of allowable employee business expense deductions is narrower than that appropriate for self-employed individuals."  McLaughlin v. Commissioner of Revenue, Mass. ATB Findings of Fact and Reports 2005-538, 551.  The U.S. Tax Court explained an important limitation on employee business expense deductions: "When an employee has a right to reimbursement for expenditures related to his status as an employee but fails to claim such reimbursement, the expenses are not deductible because they are not 'necessary'; i.e., it is not necessary for an employee to remain unreimbursed for expenses to the extent he could have been reimbursed."  See Putnam v. Commissioner, 76 T.C.M. (CCH) 238 (1998); see also Podems v. Commissioner of Internal Revenue, 24 T.C. 21, 22-23 (1955); Heidt v. Commissioner of Revenue, 274 F.2d 25, 28 (7th Cir., 1959).  Here, the appellant made no showing whether he was entitled to seek reimbursement from his employer for the expenses that he claimed were employee business expenses, including documentation explaining his employer's reimbursement policy.  The appellant thus failed to meet his burden of proving that his claimed expenses were necessary.
iii.  The appellant's early IRA distribution
As in the previous tax year, the appellant reported an income figure that was less than the figure determined by the Commissioner to be the actual amount of his IRA distribution.  The Board again ruled that, because the appellant proffered no evidence on this issue, the Board upheld this portion of the Commissioner's assessment.  Staples, 305 Mass. at 26.  
As to whether the early IRA distribution was includible as income on his Mass. Return, the appellant claimed that he needed the income to provide for his maintenance and support, because he had no income from the State Department after his termination at the end of March.  However, no exception exists to prevent the inclusion of an early IRA distribution as taxable income when it is made for the purpose of providing for the taxpayer's own maintenance and support: "[c]ontrary to petitioner's belief, 'there is no financial hardship exemption in [Code] § 72(t).'"   Matthew James Nasuti v. Commissioner of Internal Revenue, U.S. Tax Ct. Docket No. 2560-11 (2012), aff'd, 2013 U.S. App. LEXIS 4254 (1st Cir. 2013), (quoting Dollander v. Internal Revenue Service, 383 Fed. Appx. 932, 933 (11th Cir. 2010)); see also Robertson v. Commissioner, T.C. Memo 2000-100 (no exception exists to the additional tax on early withdrawals to provide for taxpayer's own subsistence), aff'd, 15 Fed. Appx. 467 (9th Cir., 2001).  Accordingly, the Board upheld this portion of the Commissioner's assessment.

Conclusion
The appellant bears the burden of proving that he is entitled to an abatement.  Staples v. Commissioner of Corporations and Taxation, 305 Mass. 20, 26 (1940).  This burden requires the appellant to prove the facts that entitle him to an abatement.  William Rodman & Sons, Inc. v. State Tax Commission, 373 Mass. 606, 610 (1977).  
"If no party requests that the proceedings be reported, all parties shall be deemed to have waived all rights of appeal to appeals court or the supreme judicial court upon questions as to the admission or exclusion of evidence, or as to whether a finding was warranted by the evidence."  G.L. c. 58A, § 10.  See, e.g., Good v. Commissioner of Revenue, 395 Mass. 686, 687 (1985), Minchin v. Commissioner of Revenue (1984) 393 Mass. 1004, 1005 (1984), Montaup Electric Co. v. Board of Assessors, 390 Mass. 847, 848-49 (1984).  
With regard to tax years 2006 and 2008, the Board found, based on the evidence, that the appellant failed to qualify or provide adequate substantiation for the deductions claimed.  Accordingly, the Board's decision is for the appellee for those tax years.  
With regard to tax year 2007, the Board found that the appellant provided adequate evidence to substantiate $6,693.62 of his claimed Schedule C deductions.  Accordingly, the Board granted an abatement in the amount of $1,438.78, plus statutory additions, for tax year 2007.

    THE APPELLATE TAX BOARD




  By:	_____	   _____________________	       
   Thomas W. Hammond, Jr., Chairman 

A true copy,

Attest:				_____undefinedundefinedundefinedundefined_________
	   Assistant Clerk of the Board

 The appellant appealed his termination to the Merit Systems Protection Board and then to the Court of Appeals for the Federal Circuit.  He also sought review by the United States Supreme Court, but his writ of certiorari was ultimately denied in 2010.  Following the denial of the writ of certiorari, the appellant re-filed with the Merit Systems Protection Board, and that matter was ongoing as of the date of the appellant's appeal to the Board.  No further information was provided by the parties.
 The appellant also argued, as he did for tax year 2007, that the Commissioner was required to perform a field audit.  As it did for tax year 2007, the Board rejected this argument for tax year 2008.

ATB 2015-544