- 9 - that respondent did not make a determination with respect to the $151,382 portion of the $658,000 adjustment. The Court, therefore, has jurisdiction over this issue. Petitioner's motion to dismiss for lack of jurisdiction, and its supplemental motion to dismiss for lack of jurisdiction, therefore, will be denied. In the alternative, petitioner contends that, if the Court has jurisdiction over the $151,382 issue, the burden of proof as to this issue should shift to respondent. That is the basis of petitioner's second motion. Petitioner relies primarily on Portillo v. Commissioner, 932 F.2d 1128 (5th Cir. 1991), affg. in part and revg. in part T.C. Memo. 1990-68. In its memorandum of authorities in support of this motion, petitioner argues: In the income tax return for 1991, Petitioner claimed hundreds of thousands of deductions totaling over $141 million. All deductions claimed in the return are identifiable and supportable. Petitioner can prove that all expenditures deducted in the return were proper by producing invoices and other support for such expenditures. However, this process is practically unworkable as it would involve the production of hundreds of thousands of documents and thousands of hours of court time to review. In the end, the Court would find that all expenditures were properly deducted in preparing the return, including the $151,382 of unidentified costs erroneously characterized as merger- related costs in the Disclosure Statement. Respondent must provide sufficient specificity in the Notice of Deficiency as to which deductions are being disallowed in order for the Court, Petitioner, and Respondent to come to some meaningful resolution of the issue. A blanket disallowance of unidentified costs effectively requires the taxpayer to prove up the correctness of the entire return and lends itself to a unreasonably burdensome and unworkable process for taxpayers, Respondent, and the courts.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: May 25, 2011