- 41 -
With regard to the $40,713 and $17,885 balance for 1987 and
1988, respectively, of the claimed business interest in dispute, no
credible evidence supports the treatment of these amounts as payments
of interest, and we disallow the claimed deductions for these
amounts.
Claimed $22,826 Business Bad Debt Deduction -- 1987
Petitioner argues that he is entitled to a $22,826 business bad
debt deduction (see supra p. 21) relating to an alleged $150,000 loan
made by him to Payne & Potter apart from his guaranty on the $705,000
debt obligation to TexCommBk. The evidence does not support the
existence of any separate loan of $150,000 made by petitioner to
Payne & Potter. Petitioner's testimony on this item was not
credible. Petitioner's claimed deduction for a $22,826 business bad
debt was properly disallowed.
Remaining Claimed Business Deductions -- 1987 and 1988
No evidence supports the remaining $27,135 and $21,318 in
business deductions that petitioner claims for 1987 and 1988,
respectively (see supra p. 21). These deductions were properly
disallowed by respondent.
Itemized Deductions Still in Dispute -- 1988
Petitioner argues that he is entitled to the claimed itemized
deductions for medical expenses of $16,321 and charitable
contributions of $2,300 (see supra p. 21).
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