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support petitioner's claim that he contributed to Bob Wade Ford
before 1988. Although petitioner claims that he contributed
$5,763,262 to Bob Wade Ford from 1976 to 1989, his records such
as canceled checks and Merrill Lynch money market account
statements fall short of establishing that amount. Bob Wade Ford
reported losses of $4,636,660 from 1976 to 1987 ($4,200,320 of
which was allocated to petitioner in those years); petitioner's
records do not establish that he contributed more than $4,200,320
from 1976 to 1987 such that he would have a basis in Bob Wade
Ford at the end of 1987. Petitioner has not established that he
had any basis in the dealership at the end of 1987. Since
petitioner did not establish that he had a basis in Bob Wade Ford
at the end of 1987, his share of the dealership's loss for 1988
is limited to the amount he contributed in 1988 ($125,000). Sec.
1366(d)(1). Petitioner's share of Bob Wade Ford's loss for 1988
in excess of his adjusted basis is carried over to 1989. Sec.
1366(d)(2).
2. Bob Wade Ford's Losses in 1988 and 1989
Bob Wade Ford reported losses of $256,752 in 1988 and
$133,709 in 1989. Respondent contends that petitioners may not
deduct losses for 1988 based on journal entry No. 2 ($31,789),
journal entry No. 7 ($24,000), and check No. 20862 ($2,000).1
1 The item for 1989 is a timing adjustment. The parties
agree that, if journal entry No. 7 is disallowed for 1988, then a
$24,000 deduction is allowed in 1989.
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