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determined that Management had failed to report tens of millions
of dollars of income from (1) cattle purportedly transferred to
it by numerous cattle-breeding partnerships as management fees
under the sharecrop agreements between them and Management and
(2) large numbers of those same cattle Management then
purportedly transferred to Ranches in payment for feed,
management, consulting, freight services, and other goods and
services provided by Ranches.
DF #1, SGE 82-1, DGE 84-3, SGE 84-5, DGE 86-2, TBS 89-1, TBS
90-1, and Management filed respective petitions seeking review of
the FPAA’s that had been issued to them. In their respective
petitions or amended petitions, these partnerships have modified
the depreciation and other deductions being claimed by them for
the years in issue. The total depreciation, other deductions,
and other adjustments now in issue are given infra in appendix B
to this Memorandum Opinion.
OPINION
Petitioners bear the burden of proving that respondent’s
determinations in the FPAA’s are incorrect. See Rules 142(a),
240(a); Welch v. Helvering, 290 U.S. 111 (1933). Particularly,
where respondent, as in the instant cases, has disallowed
depreciation and other deductions claimed by a partnership, it is
incumbent on petitioners to substantiate and establish the
partnership’s entitlement to those deductions under the terms of
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