23
We find that petitioners have not established their basis in the
Bohannon, S.A. stock they sold in 1988 and 1989. We sustain
respondent on this issue.
D. Net Operating Loss Carryforward
Respondent determined that petitioners may not deduct net
operating losses carried forward to 1988 and 1989 because
petitioners did not establish the amount of the losses or that
the losses had not been absorbed in prior years. Petitioners
bear the burden of proving that they had net operating losses
from 1982 to 1987. Rule 142(a); United States v. Olympic Radio &
Television, Inc., 349 U.S. 232, 235 (1955). Petitioners must
prove the amount of the net operating loss carryforward and that
the losses were not absorbed by their gross income in those
years. Sec. 172(c); Jones v. Commissioner, 25 T.C. 1100, 1104
(1956), revd. and remanded on other grounds 259 F.2d 300 (5th
Cir. 1958); Vaughan v. Commissioner, 15 B.T.A. 596, 600 (1929).
Respondent contends that petitioners had unreported income
before 1988, that petitioners may not deduct a casualty loss in
1985, and that petitioners may not exclude income under section
911 from 1982 to 1989. Petitioners argue that because respondent
first raised these issues at trial, we should not consider them.
We need not decide this issue because petitioners did not prove
that they had deductions in excess of their reported income from
1982 to 1987, even if we do not consider whether they had
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