Taxation – Federal Income Tax – Deductibility of Seminar Cruise as Business Expense

Petitioner, a physician, participated in a postgraduate medical seminar held aboard a passenger ship during an eighteen-day cruise of the Mediterranean. A number of hour-long lectures followed by discussion periods were held on the ship during each of the six or seven days it was at sea and occasionally while in port; additional study was not required. Petitioner spent most of his time in leisurely activities aboard ship and in sightseeing. All expenses of the course and cruise were included in one charge which petitioner claimed as an ordinary and necessary business expense under section 162 (a) . The Commissioner of Internal Revenue disallowed the deduction. On petition to the Tax Court, held, only a small part of the total cost was an ordinary and necessary business expense because of the vacation aspect of the cruise, similar courses offered in the United States, the number and extent of the lectures, the usefulness of the subject matter, and the petitioner’s economic and social position. Reuben B. Hoover, 35 T.C. 566 (1961).