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reflected on the above return of the Lily Partnership based on
the same total claimed tax bases in the properties.
On audit for 1989, respondent disallowed in its entirety the
Lily Partnership's claimed depreciation deduction of $89,285
relating to the properties. Respondent’s disallowance of the
Lily Partnership’s claimed depreciation expense relating to the
properties was, among other things, based on the inconsistency
between, on the one hand, the $147,262 that petitioner had
reflected for the value of the properties on her individual 1986
Federal income tax return (that was used to compute petitioner's
gain relating to the liquidation of LY Enterprises) and, on the
other hand, the total $1,912,764 tax bases reflected on the Lily
Partnership’s 1989 return with respect to the properties (that
was used for the computation of depreciation claimed with respect
to the properties on petitioner’s 1989 Federal income tax
return).
On April 15, 1993, consistent with respondent’s disallowance
of the claimed depreciation expense relating to properties on the
Lily Partnership’s 1989 return, respondent mailed a notice of
deficiency to petitioner for 1989 in which respondent disallowed
the depreciation expense claimed on petitioner's 1989 Federal
income tax return with respect to the properties.
In Fong v. Commissioner, docket No. 15292-93 (the 1989 Fong
case), petitioner contested respondent’s disallowance of the
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