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exceed $100,000 in the case of a husband and wife filing a joint
return. Sec. 1244(b)(2).
The term "section 1244 stock" generally means stock of a
qualifying domestic small business corporation that was issued
for money or other property (other than stock or securities).
Sec. 1244(c). The Commissioner is empowered to prescribe
regulations necessary to carry out the purposes of section 1244.
Sec. 1244(e). Pursuant to that authority, the Commissioner
issued regulations requiring a taxpayer to have records
sufficient to establish that the taxpayer satisfies the
requirements of section 1244 and is entitled to the loss claimed.
Sec. 1.1244(e)-1(b), Income Tax Regs.
In order to substantiate an ordinary loss deduction claimed
by its shareholders, a corporation should maintain records that
show the persons to whom the stock was issued, the date of
issuance to these persons, and a description of the amount and
type of consideration received from each person. Sec. 1.1244(e)-
1(a)(2), Income Tax Regs. There are other requirements that we
need not detail here. We have held that strict compliance with
the requirements of section 1244 and the regulations thereunder
is necessary to obtain the benefits of the section. Mogab v.
Commissioner, 70 T.C. 208, 212 (1978); Gubbini v. Commissioner,
T.C. Memo. 1996-221.
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