- 11 - able to provide verification or substantiation for any deduction claimed with respect to such expenses. In the case before us, no documentation was introduced to substantiate any of the disallowed rental expenses. Indeed, Dr. Novick and Mr. Fenton admitted that they did not have any documents to substantiate the disallowed rental deductions. The only evidence in the record offered to support the disallowed rental expenses relating to the Texas rental was Dr. Novick's testimony with regard to the automobile and travel expenses. Dr. Novick testified that in 1989, petitioners and their three children (ages 1, 7, and 14) took a trip to inspect the Texas property and to show petitioners' children the property lines of the property they would one day inherit. The only evidence in the record to support the disallowed rental expenses relating to the Tahoe property was Dr. Novick's testimony that because the Tahoe property was a cedar house, it had to be pressure-sealed with sealant oil each year. No testimony or documentation was offered as to the cost for this treatment. The evidence offered by petitioners with respect to establishing their entitlement to the deduction for rental activity losses was woefully short of that required. Petitioners neither produced enough evidence to rebut respondent's deficiency determination nor produced enough evidence to satisfy their burden of persuasion. Consequently, petitioners are not entitled to anyPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
Last modified: May 25, 2011