- 5 -
Helvering, 290 U.S. 111, 115 (1933).3 Taxpayers do not have an
inherent right to take tax deductions. Deductions are a matter
of legislative grace, and a taxpayer bears the burden of proving
entitlement to any deduction claimed. See Deputy v. du Pont, 308
U.S. 488, 493 (1940); New Colonial Ice Co. v. Helvering, 292 U.S.
435, 440 (1934). This includes the burden of substantiating the
amount and purpose of the item claimed. See sec. 6001; Hradesky
v. Commissioner, 65 T.C. 87, 89-90 (1975), affd. per curiam 540
F.2d 821 (5th Cir. 1976); sec. 1.6001-1(a), Income Tax Regs.
If a taxpayer has established that deductible expenses were
incurred but has not established the amount of such expenses, we
may estimate the amount allowable, bearing heavily if we so
choose upon the taxpayer whose inexactitude is of his own making.
See Cohan v. Commissioner, 39 F.2d 540, 543-544 (2d Cir. 1930).
However, there must be evidence in the record that provides a
rational basis for our estimate. See Vanicek v. Commissioner, 85
T.C. 731, 742-743 (1985).
Issue 1. Personal Exemption
Petitioner claimed a dependency exemption for his son,
Bradley, on his 1995 Federal income tax return. Respondent
3On his pretrial memorandum, petitioner referenced the
Taxpayer Bill of Rights as applying in this case. However, the
burden of proof provisions of sec. 7491 do not apply here because
the examination in this case began prior to July 22, 1998. See
IRS Restructuring and Reform Act of 1998, Pub. L. 105-206, 112
Stat. 726.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
Last modified: May 25, 2011