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reasonable, we believe that here it did not produce a correct
result.
In Diaz v. Commissioner, 58 T.C. 560, 562 (1972), we noted
that the process of distilling truth from the testimony of
witnesses is the daily grist of judicial life. At trial, we
observed Messrs. Fields, Sharpe, and Peacock as they testified, and
we had the opportunity to evaluate their credibility. We found
their testimony to be credible.
On the basis of their testimony, and that of others, we are
convinced that all proceeds of the bingo games, net of expenses,
went to the sponsoring organizations, not to petitioners.
Respondent’s evidence to the contrary was not convincing. Indeed,
under respondent’s “alternative method” which used the bingo
accountability sheets, one could extrapolate that all net income
from the bingo games went to the sponsoring organizations.
Accordingly, we do not sustain respondent’s determination that
petitioners had unreported income for 1993 and 1994.
Issue 2: Losses From Van Pool Activity
We now address the losses claimed by the Bullocks arising from
Mr. Bullock’s van pool activity.
The parties have stipulated (1) the amounts of income and
expenses reported on the returns for the activity, (2) Mr.
Bullock’s driving of the van coincided with his own commute, and
(3) no contemporaneous records were maintained. The record is
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