In the case of Fausner v. Commissioner of Internal Revenue, 1972, the U.S Supreme Court was tasked with determining whether or not a taxpayer could deduct expenses related to maintaining an office in his home. The petitioner, Mr. Fausner, worked as a lawyer and maintained an office at home for convenience despite having another primary office provided by his employer elsewhere. He sought to deduct costs associated with this home office from his taxable income. The court ruled against Mr. Fausner's claim stating that under Section 262 of the Internal Revenue Code (IRC), personal living expenses are generally non-deductible unless they qualify as trade or business expenses under Section 162(a) of IRC which requires them to be "ordinary and necessary". In this case, it was determined that since Mr.Fausner’s use of a home-office was primarily for convenience rather than necessity; therefore he couldn't classify these expenditures as ordinary and necessary business expense deductions.

In the dissenting opinion for Fausner v. Commissioner of Internal Revenue, the justice disagreed with the majority's ruling that legal fees paid by a taxpayer to defend against criminal charges were not deductible as ordinary and necessary business expenses under section 162(a) of the Internal Revenue Code. The dissent argued that such an interpretation was too narrow and failed to consider whether these expenses were directly connected to or arose from the taxpayer's trade or business activities. They contended that if a direct connection could be established, then it should be possible for taxpayers facing similar circumstances in future cases to deduct their legal defense costs as legitimate business expenses. This would ensure fairness in tax treatment while also recognizing how closely intertwined personal actions can sometimes become with professional responsibilities, particularly among high-ranking corporate executives like Mr. Fausner who are often personally targeted in litigation related to their company’s operations.