Michael and Christa Dee Richardson - Page 4

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          Id.  Section 165(e) provides that "any loss arising from theft              
          shall be treated as sustained during the taxable year in which              
          the taxpayer discovers such loss."                                          
               Petitioner must prove the adjusted basis of his property.              
          Millsap v. Commissioner, 46 T.C. 751, 760 (1966), affd. 387 F.2d            
          420 (8th Cir. 1968).  A loss cannot be computed where the                   
          taxpayer's basis in property is not proven.  Id.; Leighton v.               
          Commissioner, T.C. Memo. 1995-515, affd. without published                  
          opinion 108 F.3d 332 (5th Cir. 1997); Fisher v. Commissioner,               
          T.C. Memo. 1986-141.                                                        
               Petitioner presented no records to support even the                    
          existence of the equipment.  He presented no bills of sale,                 
          receipts, canceled checks, or business records to establish the             
          basis of the equipment.  Petitioner testified as to dollar                  
          amounts regarding the equipment but his testimony was not                   
          credible.  We are not required to accept the self-serving                   
          testimony of petitioner as gospel.  Tokarski v. Commissioner, 87            
          T.C. 74, 77 (1986).  We find that petitioners are not entitled to           
          deduct any loss under section 165 because petitioner failed to              
          prove his adjusted basis in the property.                                   
               Calendar year individual taxpayers must file a Federal                 
          income tax return by April 15 following the close of the calendar           
          year.  Sec. 6072(a).  Section 6651(a)(1) imposes an addition to             
          tax for failure to file a Federal income tax return by its due              





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