from www.webcpa.com – The Tax Court has denied a Brooklyn tax lawyer’s attempt to claim over $100,000 in payments for prostitutes and pornography as medical expense deductions.

In the case, William G. Halby v. Commissioner of Internal Revenue, Judge Joseph Robert Goeke noted, “During 2004 and 2005 petitioner frequented prostitutes in New York. Petitioner did not visit these prostitutes as part of a course of therapy prescribed by his doctor, nor did petitioner ask his doctor to prescribe any sort of sex therapy. Petitioner kept track of these visits in a journal.

The journal included the date, the name of the ‘service provider,’ and the amount. Petitioner did not discuss these visits with his doctors afterwards to determine their impact on his health. During 2004 and 2005, petitioner purchased pornography and books and magazines on sex therapy. Petitioner also recorded the dates and amounts of the purchases in his journal.”

Halby, 78, a semi-retired tax attorney with the firm McMillan, Constabile, Maker & Perrone, claimed medical expense deductions of $76,314 on his Schedule A for 2004 and $49,203 for 2005. The IRS issued a notice of deficiency for 2004 disallowing $2,368 for medical books, magazines, videos, and pornographic material; $65,934 for prostitutes; and $5,632 in bank and finance charges incurred in connection with loans used to pay for the claimed medical expenses. The $47,024 disallowed for 2005 included $5,005 for books, magazines, videos, and pornographic materials; and $42,152 for prostitutes.

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The judge agreed with the IRS that Halby was not entitled to deduct the amounts at issue. “Patronizing a prostitute is illegal in the State of New York,” he wrote, adding, “Petitioner’s payments to various prostitutes were personal expenses not prescribed by a doctor and not intended to treat a medical condition. Petitioner is not entitled to deductions for these amounts. Petitioner is likewise not entitled to deductions for amounts paid for books and magazines on sex therapy and pornography. The purchases were not for the treatment of a medical condition but were instead personal items.”

The court upheld the IRS’s determination that Halby pay $21,491 in back taxes and $4,298 in accuracy-related penalties. Halby also lost a case last September in the New York State Division of Tax Appeals in which he had tried to deduct $322,000 in sex-related charges for 2001-2005.

Halby did not immediately respond to a request for comment.