- 29 -
business expenditures for which petitioner failed to provide
adequate substantiation. But the fact that petitioner failed to
meet his burden of proof regarding the deductibility of these
expenses is not sufficient to justify a finding that respondent
has met his burden of proving that petitioner treated the income
deposited in the business bank account as if he were solely
entitled to it.
The facts on which respondent relies establish only that
Mrs. Shea had little meaningful involvement in petitioner's
business activities and that petitioner underreported the income
of that business. These facts are insufficient to prove that
petitioner acted as if he were solely entitled to STG's 1992
income. As a result, there is no factual basis to justify
respondent's invocation of section 66(b). We, therefore, hold
that petitioner is entitled to the benefits of California
community property law with respect to the net income of his
consulting business as redetermined.
Decision will be entered
under Rule 155.
Reviewed by the Court.
COHEN, JACOBS, GERBER, PARR, WELLS, COLVIN, BEGHE, LARO,
FOLEY, VASQUEZ, and GALE, JJ., agree with this majority opinion.
THORNTON and MARVEL, JJ., concur in the result only.
Page: Previous 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 NextLast modified: May 25, 2011