Cohan Rule for California Franchise Tax Board

Yes.

But.... please note that the rule does not allow you to just create a number out of thin air. You may not have the receipts to substantiate your expense, but you still have to provide some credible evidence that you incurred the expense and that there is a reasonable basis to estimate the amount.

Yes.

But.... please note that the rule does not allow you to just create a number out of thin air. You may not have the receipts to substantiate your expense, but you still have to provide some credible evidence that you incurred the expense and that there is a reasonable basis to estimate the amount. ==== Note that in practice, this type of argument has NOT been accepted by the Board of Equalization should the income tax appeal progress to their level. I witnessed such an argument in 2003 (2 cases earlier on the docket the one for which I was there) made by an experienced tax attorney, and the Board members denied all expenses.