-4-
grantor's taxable income and credits is treated as if the grantor
had received or paid it directly. Sec. 1.671-2(c), Income Tax
Regs. The effect of these provisions is that the trust is
disregarded as a separate entity in computing the taxable income
from the grantor's portion of the trust, and the grantor is taxed
on the income as if he received it directly. Scheft v.
Commissioner, 59 T.C. 428, 431-432 (1972). Accordingly,
petitioner must establish that he is entitled to the depreciation
deduction claimed as if he owned the safe deposit boxes directly,
and not through the trust.
Petitioner has the burden of proving that he is entitled to
the depreciation deduction claimed. Bell Electric Co. v.
Commissioner, 45 T.C. 158, 167 (1965); Williams v. Commissioner,
T.C. Memo. 1991-567. Petitioner presented no evidence as to the
basis or recovery period of the safe deposit boxes. Accordingly,
petitioner has failed to carry his burden of proving that he is
entitled to a deduction for depreciation. We therefore sustain
respondent's determination that petitioner had unreported income
in the amount of $12,564.
To reflect the foregoing,
Decision will be entered
for respondent.
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Last modified: May 25, 2011