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Petitioner presented documentation regarding the purchase of
the equipment but did not explain why the cost of the asset was
deducted as an expense and also capitalized and depreciated.
Petitioner’s sole statement in its brief regarding this issue is
as follows: “A.J. Concrete Pumping, Inc. purchased used
inoperative equipment in the amount of $22,250 from the Bellamy
Brothers, Inc., so as to ‘cannibalize’ it for spare parts not
readily available in the open market.” We find this
uncorroborated statement to be, by itself, unhelpful and
unpersuasive. Accordingly, respondent’s disallowance of the
$22,250 deduction is sustained.
2. Miscellaneous Deduction
Petitioner deducted $15,204 for miscellaneous costs on its
1992 tax return. Respondent disallowed $11,997 of this amount,
and petitioner did not present any evidence supporting this
deduction. On brief, petitioner’s sole argument regarding this
issue is that respondent is taking a “convenient position” that
this expense belongs to Olympic and not petitioner, and borders
on being a “whipsaw proposed adjustment”. Regardless of
petitioner’s opinion about respondent’s proposed adjustments,
petitioner has failed to present any evidence substantiating its
entitlement to the “miscellaneous deduction”. Accordingly,
respondent’s determination on this item is sustained.
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