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Interest on a mortgage on real estate is deductible. Sec.
163. Where mortgaged property is jointly owned and the co-owners
are jointly liable on the mortgage each owner is entitled to a
deduction for the mortgage interest that he actually pays out of
his own funds. Castaneda-Benitez v. Commissioner, T.C. Memo.
1981-157.
Section 6001 and the regulations promulgated thereunder
require a taxpayer to maintain adequate records to substantiate
the claimed deductions. However, if certain claimed deductions
are not substantiated, we are permitted to estimate them when we
are convinced from the record that the taxpayer has incurred such
expense and we have a basis upon which to make an estimate.
Cohan v. Commissioner, 39 F.2d 540 (2d Cir. 1930); Vanicek v.
Commissioner, 85 T.C. 731, 743 (1985).
Petitioner testified that he paid $1,575 of mortgage
interest expense on the Arizona rental property for 1990.
For 1990, the record shows that petitioner's funds were used
to make the mortgage payments. Further, the Temporary and Final
Orders required petitioner to continue to make the mortgage
payments on the Arizona rental property of approximately $340 a
month. We further note that Ms. Petrie assumed the outstanding
mortgage in 1992. We are convinced from the record that there
was an outstanding mortgage on the Arizona rental property in
1990, and that petitioner made the mortgage payments.
Accordingly, we find that petitioner is entitled to a mortgage
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