18
D. Whether Petitioner Failed To Report Capital Gains in 1992
Petitioner reported capital gains totaling $11,965 on
Schedule D of his 1992 return. Respondent determined that
petitioner had capital gains of $30,760 for 1992.
1. Walden Agreement
Petitioner testified that he had an oral agreement with
Floyd A. Walden (Walden), who he described as a retired bank
manager and a stock market expert, under which 50 percent of his
capital gain was income to and reportable by Walden. Petitioner
did not offer any documentary evidence that he had an agreement
with Walden, or evidence that Walden reported any of his alleged
share of the gain in 1992. Walden did not testify. Petitioner
did not establish that any of the $30,760 of capital gain was
taxable to Walden. We sustain respondent's determination.
2. Brentwood Apartments
Petitioner bought the Brentwood Apartments around 1990 for
$80,000. He took $4,000 of depreciation per year for 2 years.
Petitioner sold the Brentwood property in 1992 for $190,000.
Respondent determined that petitioner failed to report gain of
$122,000 [$190,000 - ($80,000 - $12,000)] (3 years of
depreciation).
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