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not allowed as a deduction unless the income such items represent
has been included in the return of income for the year for which
the deduction as a bad debt is claimed or for a prior taxable
year. See Gertz v. Commissioner, 64 T.C. 598 (1975); Garrison v.
Commissioner, T.C. Memo. 1994-200, affd. without published
opinion 67 F.3d 299 (6th Cir. 1995); sec. 1.166-1(e), Income Tax
Regs.
At trial, petitioners submitted various stopped checks and
work orders and claimed that these items substantiate their
claimed bad debt deductions. Contrary to petitioners'
assertions, these documents do not demonstrate that the income
which gave rise to these items was in fact included in their
gross income. Although petitioner was a well-spoken witness, he
has not furnished any documentation that would corroborate his
position. In the present case, we cannot rely upon petitioner's
self-serving, uncorroborated testimony. See Niedringhaus v.
Commissioner, 99 T.C. 202, 219-220 (1992); Tokarski v.
Commissioner, 87 T.C. 74, 77 (1986). The tax law requires
taxpayers to substantiate amounts claimed as deductions by
maintaining the records necessary to establish such entitlement.
See Hradesky v. Commissioner, 65 T.C. 87, 90 (1975), affd. per
curiam 540 F.2d 821 (5th Cir. 1976); sec. 1.6001-1(a), Income Tax
Regs. During the trial, petitioner admitted that he destroyed
the worksheets that he claims might have substantiated his
position. Moreover, petitioners have not submitted evidence that
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