expenses for the years 1984 through 1988 as follows:
1984 1985 1986 1987 1988
Income none $1,250 $2,900 none none
Expenses
Repairs 8,534 2,380 $4,029
Insurance,
taxes, fees 20,810 15,387 5,500 $939
Interest 17,333 20,366 10,520
Depreciation $28,482 47,851 47,260 39,875
Claimed Loss 28,482 93,278 82,493 59,924 939
Petitioners also claimed losses from rental activity in the
amounts of $19,068, $18,794, $19,649, $19,347, and $16,107 for
the years 1984, 1985, 1986, 1987, and 1988, respectively.
II. General Legal Principles
As a general rule, the Commissioner's determinations are
afforded a presumption of correctness, and the taxpayer bears the
burden of proving that those determinations are erroneous. Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933). Moreover,
deductions are a matter of legislative grace, and the taxpayer
bears the burden of proving that he is entitled to claimed
deductions. Rule 142(a); New Colonial Ice Co. v. Helvering, 292
U.S. 435, 440 (1934); Welch v. Helvering, supra. This includes
the burden of substantiating the amount and purpose of the item
claimed. Hradesky v. Commissioner, 65 T.C. 87, 90 (1975), affd.
per curiam 540 F.2d 821 (5th Cir. 1976).
In determining whether petitioners are entitled to deduct
losses from their boat chartering and residential rental
activities, we must decide whether these activities were engaged
in for profit within the meaning of section 183. Section 183(a)
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