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unreported income before 1988 and even if we assume that they
could deduct a casualty loss and exclude income under section
911.
Petitioner testified that petitioners' returns for 1982 to
1989 were true and correct. His testimony does not convince us
that petitioners are eligible for net operating loss
carryforwards to 1988 and 1989. A tax return does not establish
the correctness of the facts stated in it. Seaboard Commercial
Corp. v. Commissioner, 28 T.C. 1034, 1051 (1957); see Wilkinson
v. Commissioner, 71 T.C. 633, 639 (1979); Roberts v.
Commissioner, 62 T.C. 834, 837 (1974). As we stated above,
petitioner's testimony was often evasive, vague, and not
credible, yet petitioners ask us to accept (without any records)
his testimony that their tax returns for 10 to 15 years were true
and accurate. We are not bound to accept the testimony of a
taxpayer under these circumstances. Hradesky v. Commissioner, 65
T.C. 87, 90 (1975), affd. per curiam 540 F.2d 821 (5th Cir.
1976).
Kane testified that petitioners' net operating loss
carryover was $1,706,535 at the end of 1988 and $1,555,655 at the
end of 1989. He did not testify about the net operating loss
carryover available at the end of 1987. The only indication of
the net operating loss carryforward to 1988 is the amount
petitioners claimed on their 1988 return. Kane's worksheets
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