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Making Cents: Yankee Doodle Tax Law Might Be Music to Your Ears

May 19, 1996

Incomplete receipts are OK, thanks to a composer. In most aspects of U.S. law, a person accused of a crime is assumed innocent until proven guilty. Not so when it comes to tax law, which is unique in that taxpayers are required to prove their innocence by providing proof of both their income and deductions, if the IRS accuses them of cheating. If you're audited, you'll be expected to produce receipts showing that all the deductions you claimed were legitimate. What if you're missing a few receipts? No problem, thanks to composer George M. Cohan, a taxpayer who took the IRS to court in the 1920s and inspired the "Cohan rule." The long and short of the rule: If some of your records were lost or destroyed, the IRS must accept a reasonable estimate.

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