Richard A. Gerstenberger - Page 11




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          See INDOPCO, Inc. v. Commissioner, 503 U.S. 79, 84 (1992).                  
               With respect to petitioner’s contention that respondent                
          erred in disallowing the NOL deduction, section 172 allows a                
          deduction for an NOL for the taxable year in an amount equal to             
          the NOL carried back to the taxable year and the NOL carried                
          forward to the taxable year.  See sec. 172(a).  An NOL is defined           
          as the excess of deductions over gross income for a particular              
          taxable year, with certain modifications.  See sec. 172(c) and              
          (d).  Petitioner, as the claimant of an NOL deduction, must prove           
          his right thereto.  See United States v. Olympic Radio & Televi-            
          sion, Inc., 349 U.S. 232, 235 (1955).                                       
               It is petitioner’s position that he had an NOL for 1993 that           
          he is entitled to carry forward to the year at issue.  According            
          to petitioner, the NOL that he claims for 1993 was produced by an           
          alleged loss from the 1991 purported theft, which he did not                
          discover until sometime during 1993 (1993 claimed theft loss).              
          Respondent argues that petitioner has failed to substantiate the            
          1993 claimed theft loss and, consequently, has failed to prove              
          his entitlement to the NOL deduction.                                       
               Section 165 allows a taxpayer to deduct any loss from theft            
          in the year during which the taxpayer discovers such loss.  See             
          sec. 165(a), (e).  Petitioner bears the burden of proving that a            
          theft has occurred and that the requirements of section 165 have            
          been met.  See Rule 142(a); Allen v. Commissioner, 16 T.C. 163,             






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