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lien filed against their interest and, therefore, were paid for
petitioners' benefit.
Petitioners' only argument is that Conoco paid Lauck in
excess of the mechanic's lien and that Lauck never remitted the
excess to petitioners. Petitioners presented no evidence at
trial as to the amount of Lauck's lien. Additionally,
petitioners failed to establish the exact amounts Lauck received
from Conoco in satisfaction of Lauck's lien. Petitioners have
failed to prove that respondent's determination is incorrect.3
See Rule 142(a). Accordingly, we find that petitioners had
unreported income from Conoco of $2,398 and $2,031 in 1994 and
1995, respectively.
Disallowed Itemized Deductions
In the notice of deficiency, respondent disallowed certain
itemized deductions totaling $17,872 claimed by petitioners on
their 1994 return.
3 We note that the U.S. Court of Appeals for the Ninth
Circuit, to which this case is appealable, has held that in order
for the presumption of correctness to attach to the notice of
deficiency in unreported income cases, respondent must come
forward with substantive evidence establishing "some evidentiary
foundation" linking the taxpayer to the income-producing
activity. Weimerskirch v. Commissioner, 596 F.2d 358, 361-362
(9th Cir. 1979), revg. 67 T.C. 672 (1977); see also sec.
6201(d)(as amended). Based on the evidence presented at trial,
including Mr. Dykstra's testimony and documentary evidence, we
conclude that respondent has adequately shown a connection
between Mr. Dykstra and the oil lease. Respondent's
determination, therefore, is entitled to the presumption of
correctness.
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