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contend that a loss in the amount of $55,000 was "sustained" in
1992. Respondent contends to the contrary. We agree with
respondent for the following reasons.
In order to be deductible under section 165, "a loss must be
evidenced by closed and completed transactions, fixed by
identifiable events, and * * * actually sustained during the
taxable year." Sec. 1.165-1(b), Income Tax Regs; see also sec.
1.165-1(d)(1), Income Tax Regs. A loss is not sustained during
the taxable year if "there exists a claim for reimbursement with
respect to which there is a reasonable prospect of recovery".
Sec. 1.165-1(d)(2)(i) and (3), Income Tax Regs. In this event,
the deductibility of a loss is postponed until the taxable year
in which "it can be ascertained with reasonable certainty whether
or not such reimbursement will be received." Sec. 1.165-
1(d)(2)(i), Income Tax Regs; see sec. 1.165-1(d)(3), Income Tax
Regs. "Whether a reasonable prospect of recovery exists with
respect to a claim for reimbursement of a loss is a question of
fact to be determined upon an examination of all facts and
circumstances." Sec. 1.165-1(d)(2)(i), Income Tax Regs.
Petitioners bear the burden of proof on this question of fact.
Rule 142(a); INDOPCO, Inc. v. Commissioner, supra at 84; Welch v.
Helvering, supra at 115.
We hold that petitioner failed to prove that he had a
reasonable prospect of recovering any part of the $55,000 from
Mr. Suiter after 1990.
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