-53-
year. The amount of the deduction for a bad debt is limited to
the taxpayer's adjusted basis in the debt as provided by section
1011. Sec. 166(b); Perry v. Commissioner, 92 T.C. 470, 477-478
(1989), affd. without published opinion 912 F.2d 1466 (5th Cir.
1990).
Section 166(d)(1)(B) provides that where any nonbusiness bad
debt becomes worthless within the taxable year, the loss
resulting therefrom shall be considered a loss from the sale or
exchange, during the taxable year, of a capital asset held for
not more than 1 year.
There is no standard test or formula for determining
worthlessness within a given taxable year; the determination must
depend upon the particular facts and circumstances of the case.
Crown v. Commissioner, 77 T.C. 582, 598 (1981); sec. 1.166-2(a),
Income Tax Regs. However, it is generally accepted that the year
of worthlessness is to be fixed by identifiable events which form
the basis of reasonable grounds for abandoning any hope of
recovery. Crown v. Commissioner, supra. The taxpayer bears the
burden of proving that the debt had value at the beginning of the
taxable year and that it became worthless during and prior to the
end of that year. Millsap v. Commissioner, 46 T.C. 751, 762
(1966), affd. 387 F.2d 420 (8th Cir. 1968).
Petitioners offered no testimony or evidence about the
losses from "J. Bradley" or "Ext Wall Vent" that they reported on
their return. Rather, in describing the loss at trial,
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