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from Mr. Burke equal to the Bank Stock's original cost because
the value of the stock was "uncertain and extremely doubtful".
Petitioners allege that the Bank stock became worthless in or
around 1984, and that they never received any benefit from their
ownership of the stock. Petitioners argue that the substance of
the facts surrounding the cancellation of Mr. Burke's debt is
analogous to Kerbaugh-Empire Co., although the form that they
employed to effectuate this cancellation is not. Respondent
argues that the form used by petitioners controls this case, and,
even if it does not, BEC's cancellation of Mr. Burke's debt is a
taxable event. Petitioners bear the burden of proof. Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933).
We agree with respondent that BEC's cancellation of
Mr. Burke's debt is a taxable event. Petitioners' brief is aimed
primarily at their claim that the instant facts resemble the
facts of Bowers v. Kerbaugh-Empire Co., supra, and that Kerbaugh-
Empire Co. entitles them to exclude the amount of canceled debt
from income. To support their position, petitioners rely mainly
on Mr. Burke's testimony, which was brief. We are unpersuaded.
We find most of Mr. Burke's testimony unbelievable. It was
general and conclusory in nature, and most of it is unsupported
by other evidence in the record. Under the circumstances, we are
not required to rely on this testimony, and we do not. United
States v. Hager, 969 F.2d 883, 888 (10th Cir. 1992); United
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