- 4 -
In the notice of deficiency, respondent disallowed the
$9,750 cost of goods sold and all of the $18,823 claimed expenses
for lack of substantiation.
The determinations of the Commissioner in a notice of
deficiency are presumed correct, and the taxpayer bears the
burden of proving that the determinations are incorrect. Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933).
Petitioner produced no documentary evidence to substantiate
any of the items that were disallowed by respondent.
Petitioner's explanation for the failure to produce such evidence
is that, in late April and early May 1989, he attended a
religious convention in Richmond, Virginia. He took all his
books and records with him to work on his Federal income tax
return for 1988. After the Richmond convention concluded, he
drove to New York, and, while he was having lunch with his sister
at a Brooklyn restaurant, someone broke into his truck and took
his briefcase, which contained all of his tax records. No other
property in the truck was taken, although petitioner acknowledged
he had books in the truck having a value of over $9,000. Upon
discovery of the break-in, petitioner drove the truck a few
blocks and located his briefcase, which was damaged. All of the
contents were missing. For this reason, petitioner had no
records to produce at trial to support his claimed expenses.
When questioned by the Court, petitioner admitted he had made no
Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011