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additional vehicles), and respondent's concession of $5,622 of
the $8,166 in depreciation claimed on their return, the total
amount of depreciation in dispute for 1992 is $3,288. With
respect to the amount remaining in dispute, respondent argues
that petitioners' failure to substantiate the depreciable bases
in or acquisition dates of the assets in question precludes their
claim for depreciation.
(d) Office Expenses in 1992
Just prior to trial, petitioners claimed deductions in the
amount of $958, attributable to office expenses, which were not
claimed on their 1992 return. Although petitioners repeated
their assertion of this claim in their posttrial answering brief,
they did not discuss this issue at trial, and have presented no
evidence to substantiate these claimed expenses.
OPINION
We begin by noting that respondent's determinations are
presumed correct, and petitioners bear the burden of proving that
those determinations are erroneous. Rule 142(a); Welch v.
Helvering, 290 U.S. 111, 115 (1933). Moreover, deductions are a
matter of legislative grace, and petitioners bear the burden of
proving that they are entitled to any deductions claimed.
INDOPCO, Inc. v. Commissioner, 503 U.S. 79, 84 (1992).
1. Net Operating Loss
We first address whether petitioner Charles F. Patterson is
entitled to claim an NOL on his 1991 return in the amount of
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