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of Appeals held that, although the Commissioner had made a
"determination", the presumption of correctness could not be
accorded to that determination.
In this case, there is no third party payer involved as to
the issue before the Court. Petitioner does not have the burden
of proving a negative. Moreover, this case does not involve
unreported income but disallowed deductions. Petitioner has
books and records by which it can, according to its own
assertions, substantiate fully, albeit at some burden, the
expenses reported on its return. Petitioner alleges that such
proof would show no merger-related expenses in excess of
$506,618. The Portillo rationale, therefore, is not applicable
to the facts of this case. Respondent's determination in the
notice of deficiency is entitled to the presumption of
correctness, and the burden to show that this determination is in
error lies with petitioner. Petitioner's motion to shift the
burden of proof to respondent, therefore, will be denied.
An appropriate order
will be issued.
6(...continued)
the payer. At trial, the taxpayer agreed that the correct amount
received was $13,925. Prior to issuance of the notice of
deficiency, the IRS examining agent contacted the payer, and the
payer's records reflected payments to Mr. Portillo of $13,925.
The payer was unable to prove to the examining agent that he had
made payments of $35,305 to Mr. Portillo as reported on the
information return of the payer to the IRS.
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Last modified: May 25, 2011