- 3 -
return for accuracy. Dan Mitchell, a certified public
accountant, prepared petitioner’s 1994 tax return.
Respondent used a bank deposit analysis to reconstruct
petitioner’s income relating to Allied Electric; disallowed
$77,531 of Schedule C, Profit or Loss From Business, deductions,
relating to Allied Electric; and determined a deficiency in
petitioner’s 1994 taxes and a section 6662(a) accuracy-related
penalty.
OPINION
I. Petitioner’s Real Estate Activities
We sustain respondent’s determinations relating to
petitioner’s residential properties. Petitioner had the burden
of proof,1 yet presented unreliable documentary evidence and
contradictory testimony. Rule 142(a).
A. 139 El Monte
139 El Monte was not held for the production of income.
Armando Pineda occupied the property for part of 1994, while
petitioner’s daughter occupied it for the remainder of the year.
There is no credible evidence (i.e., rent payments, lease
agreements, canceled checks, general ledgers, etc.) establishing
that petitioner rented the property to those individuals.
Depreciation and maintenance expenses relating to a residence
1Sec. 7491 is not applicable to this case.
Page: Previous 1 2 3 4 5 6 Next
Last modified: May 25, 2011