Jim Chapin, a California real estate broker, used his Toyota Sequoia SUV for his real estate business during 2009.
He figured that he drove a total of 11,135 miles for business that year and deducted $5,309 for car and truck expenses.
The IRS audited him and disallowed the entire deduction, and also added on a 20 percent negligence penalty. Chapin appealed to the Tax Court and lost.
Here’s what he did wrong: