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Commissioner, T.C. Memo. 1995-212, affd. without published
opinion 85 F.3d 624 (5th Cir. 1996).
Commission Expense
In the notice of deficiency, respondent disallowed $403 of
commission expenses claimed by petitioners on Schedule C of their
1989 returns. Petitioner testified that he presented
substantiation to respondent at some point, yet failed to
introduce any such substantiation for this Court to review.
Generally, petitioners have the burden of proving that the
determinations made by respondent in the notice of deficiency are
erroneous. Rule 142(a); Welch v. Helvering, 290 U.S. 111 (1933).
Petitioners have failed to meet their burden of establishing
their entitlement to the additional $403 of commission expense.
Accordingly, we hold for respondent on this issue.
Advance Commissions
Petitioner received advance commissions of $93,413,
$17,839.79, $51,161, and $42,529 for the 1988, 1989, 1990, and
1991 tax years, respectively. Respondent determined that these
advance commissions were income when received because petitioner
had complete dominion and control over the proceeds, there was no
fixed date for repayment, and petitioner never had to repay his
employer for the excess commissions. Petitioner contends that
these amounts received are loans for which petitioner was
personally liable and which he did in fact fully repay.
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