- 9 -
did not establish that the advances to CME/CMA in the amount of
$633,897 were bona fide debt.
As to the second bad debt deduction for the worthlessness of
loans made by petitioners to CME/CMA in the amount of $4,010,
petitioners provided no business records, checks, or receipts to
corroborate petitioner's testimony that the amount was actually
advanced. It is well established that, in the absence of
corroborating evidence, we are not required to accept self-
serving testimony. Niedringhaus v. Commissioner, 99 T.C. 202,
212 (1992); Tokarski v. Commissioner, 87 T.C. 74, 77 (1986); see
Jackson v. Commissioner, 19 T.C. 133, 145 (1952), affd. 207 F.2d
857 (10th Cir. 1953). Consequently, we conclude that petitioners
did not establish that the advances to CME/CMA in the amount of
$4,010 were bona fide debt.
As to petitioners' remaining arguments, we conclude that
petitioners have not carried their burden of proving that they
are entitled to the alleged losses. As we stated above,
petitioners provided no books, records, or tax returns with
respect to their interests in CME or CMA. Additionally,
petitioners did not provide promissory notes evidencing the
alleged loans to CME/CMA or books and records reflecting
petitioners' lending activities.
Taxpayers are required to maintain records that are
sufficient to enable the Commissioner to determine their correct
tax liability. See sec. 6001; Meneguzzo v. Commissioner, supra;
Page: Previous 1 2 3 4 5 6 7 8 9 10 Next
Last modified: May 25, 2011