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to a depreciation deduction, the taxpayer must show that the
property was used in a trade or business (or other profit-
oriented activity). In addition, the taxpayer must establish the
property's depreciable basis, by showing the cost of the
property, its useful life, and the previously allowable
depreciation. E.g., Delsanter v. Commissioner, 28 T.C. 845, 863
(1957), affd. in part and remanded in part 267 F.2d 39 (6th Cir.
1959).
To substantiate her entitlement to the additional
amortization and depreciation deductions, petitioner presented
testimony of her husband, Elwood, and a number of summary
schedules. According to petitioner, the summary schedules, which
were purportedly prepared by petitioner's accountant,
substantiate her entitlement to the claimed deductions. Although
petitioner indicated that the original documentation supporting
the schedules (canceled checks and receipts) was in the
courtroom, she did not offer it as evidence. In regard to this
documentation, the revenue agent that audited petitioner's
returns for the years at issue testified that he had, in the
company of petitioner's accountant, attempted to reconcile the
summary schedules with the alleged original documentation.
According to the agent, the original information could not be
reconciled with the summary schedules. Furthermore, it appeared
to the agent that a number of the claimed depreciation deductions
arose from assets that belonged to another person or entity.
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