- 18 -
(1992); New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440
(1934). Taxpayers are required to maintain records sufficient to
substantiate their claimed deductions. See sec. 6001; sec.
1.6001-1(a), Income Tax Regs. Petitioners bear the burden of
showing error in respondent’s determinations contained in the
notice of deficiency.11 See Rule 142(a); Welch v. Helvering, 290
U.S. 111, 115 (1933).
Dependency Exemption Deductions
The first issue for decision is whether Gabriel is entitled
to dependency exemption deductions for his father for tax years
1995 and 1996. Section 151(c)(1) allows a taxpayer to claim an
exemption for each qualifying dependent. A taxpayer's father or
mother whose gross income for the calendar year is less than the
exemption amount is considered the taxpayer's dependent if the
taxpayer provides more than half the father or mother's support
for the calendar year. See secs. 151(c)(1)(A), 152(a).
Respondent does not dispute that Mahmoud’s gross income was less
than the exemption amount, but contends that Gabriel did not
11 The Internal Revenue Service Restructuring & Reform Act
of 1998, Pub. L. 105-206, sec. 3001, 112 Stat. 685, 724-727,
added sec. 7491, which shifts the burden of proof to the
Secretary in certain circumstances. Sec. 7491, however, is
applicable to court proceedings arising in connection with
examinations commencing after July 22, 1998. Petitioners do not
contend, nor does the record show, that their examinations
commenced after July 22, 1998, or that sec. 7491 is applicable to
them.
Page: Previous 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 NextLast modified: May 25, 2011