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Yet, with respect to the accounting partnership activity, no
documentation of the hours worked was presented to respondent or
the Court.
We are not bound to accept the unverified, undocumented
testimony of taxpayers. Hradesky v. Commissioner, 65 T.C. 87, 90
(1975), affd. per curiam 540 F.2d 821 (5th Cir. 1976). It is
well established that the failure of a party to introduce
evidence within his or her possession which, if true, would be
favorable, gives rise to the presumption that if produced, it
would be unfavorable. Frierdich v. Commissioner, 925 F.2d 180,
185 (7th Cir. 1991), affg. T.C. Memo. 1989-393 (amending T.C.
Memo. 1989-103). If the partnership records of Scheiner &
Halpern lent support for petitioner's contention, presumably they
would have been made a part of the record. Petitioner has not
met her burden of proving that she met the requirements of
section 1.469-5T(a)(4), Temporary Income Tax Regs., supra.
Chapin v. Commissioner, T.C. Memo. 1996-56.
Petitioner has failed to establish material participation
with respect to her condominium rental activities under section
469 and the accompanying regulations. Therefore, we sustain
respondent's determination that the losses from such activities
were passive activity losses under section 469.
To reflect the foregoing,
Decision will be entered
under Rule 155.
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