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or end of 1992. Respondent's analysis also was based on the
assumption that petitioners spent $63,297 in cash on the
expenses, other than depreciation, which they claimed on their
return for Harris Enterprises.
OPINION
We decide the subject issues seriatim. We bear in mind that
petitioners bear the burden of proof, Rule 142(a); Welch v.
Helvering, 290 U.S. 111, 115 (1933), and that Congress has
required taxpayers to keep sufficient records to substantiate any
deduction that is otherwise allowed by the Code, sec. 6001; see
also New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440 (1934).
We also bear in mind that deductions are strictly a matter of
legislative grace, and that petitioners must prove their
entitlement to the disputed deductions. Rule 142(a); INDOPCO,
Inc. v. Commissioner, 503 U.S. 79, 84 (1992); Rockwell v.
Commissioner, 512 F.2d 882, 886 (9th Cir. 1975), affg. T.C. Memo.
1972-133; see also New Colonial Ice Co. v. Helvering, supra at
440 ("a taxpayer seeking a deduction must be able to point to an
applicable statute and show that * * * [the taxpayer] comes
within its terms"). Petitioners rely mainly on the testimony of
Mr. Harris to attempt to meet their burden of proof.
1. Taxable Interest Income
Respondent determined that petitioners failed to include in
their gross income $11,801 of interest income received by NBA on
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