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service business.8
Based on our examination of the entire record before us, we
find that petitioners have failed to prove that they are entitled
for 1993 to deduct under section 162(a) $2,883 of their claimed
Schedule C expenses for “Repairs and maintenance” that remain at
issue or any other amount in excess of that conceded by respon-
dent.
With respect to the deductions for 1993 totaling $6,205
claimed in Schedule C for depreciation, respondent concedes that
petitioners are entitled under section 167(a) to deduct $2,055.
However, respondent contends that petitioners are not entitled to
deduct the remaining amount (i.e., $4,150) of claimed Schedule C
depreciation. Section 167(a) allows a deduction for a reasonable
allowance for the exhaustion, wear and tear, and obsolescence of
property used in a trade or business or held for the production
of income. The basis on which a depreciation deduction is
allowable with respect to any property under section 167(a) is
the adjusted basis of the property, determined under section 1011
for the purpose of determining gain on the sale or other disposi-
tion of such property. See sec. 167(c). Petitioners introduced
no evidence to support the $4,150 of claimed Schedule C deprecia-
8We also find on the record presented that petitioners have
failed to establish that the $5,020.68 of expenses that the
documentary evidence introduced at trial establishes they paid
did not include amounts of expenses conceded by respondent as
deductible Schedule C expenses.
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