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We shall first address petitioner’s position regarding the
determinations in the notice with respect to (1) the deductions
claimed in Schedules F of the 1994 and 1995 joint returns,
(2) the amount that Ms. Treadaway received during 1994 from the
sale of the Brenda property, (3) the Social Security benefits
that Ms. Treadaway received during the years at issue, and
(4) the net operating loss deductions claimed in the 1994 and
1995 joint returns. As we understand petitioner’s position, the
property used in the horse-training activities and the income
therefrom, the Brenda property and the income therefrom, and the
Social Security benefits that Ms. Treadaway received constituted
the separate property of Ms. Treadaway, and not community prop-
erty, under the community property law of the State of Arizona.
Consequently, according to petitioner, he is not liable for the
6(...continued)
brief certain documents that are not part of the record. The
Court had those documents returned to petitioner. We also note
that we have serious reservations about petitioner’s claim that
documentation substantiating the expenses claimed in Schedules C
of the 1994 and 1995 joint returns was stolen or destroyed during
the October 1996 burglary. The claimed missing property listed
in the police reports with respect to that burglary did not
include any records identified as tax records, banker boxes, or
steel filing cabinets in which petitioner claims he kept records
relating to those returns. Moreover, even if petitioner had
persuaded us that documentation substantiating the expenses
claimed in Schedules C of the 1994 and 1995 joint returns had
been stolen or destroyed during the October 1996 burglary,
petitioner would have to meet his burden of proof in this case by
presenting credible secondary evidence. As noted above, we are
unwilling to rely on petitioner’s testimony in this case to
support his position that respondent’s determinations in the
notice are erroneous.
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