- 10 -
this case will be to the Second Circuit Court of Appeals; see
Golsen v. Commissioner, 54 T.C. 742 (1970), affd. 445 F.2d 985
(10th Cir. 1971)); Jackson v. Commissioner, 73 T.C. 394 (1979).
This, however, is not a situation where there is no evidence of
any receipts. Petitioner as much as concedes that Libutti paid a
debt on his behalf. Moreover, there is no question that a
taxpayer can realize income when another pays his debt. See,
e.g., Old Colony Trust Co. v. Commissioner, 279 U.S. 716, 729
(1929) (“The discharge by a third person of an obligation to him
is equivalent to receipt by the person taxed.”). Respondent
bears no burden here to show a taxable source for the payments
made on petitioner’s behalf by Libutti. Tokarski v.
Commissioner, 87 T.C. at 76-77. Petitioner bears the burden of
proving facts from which we could draw the conclusion that the
payments in question did not constitute gross income to
petitioner. That, petitioner has failed to do. Petitioner
having failed to carry his burden of proof, we sustain
respondent’s determination to the extent attributable to the
$10,000 in payments made to Trump by Libutti on petitioner’s
behalf.
3. 1988
During 1986, petitioner owned a bank account at Chase
Manhattan Bank, Roslyn, New York, account No. 061485 (the Chase
account). On July 1, 1988, petitioner deposited to the Chase
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Next
Last modified: May 25, 2011