- 29 -
Petitioner also provided a letter dated October 10, 1996,
written by Architect Alan Lerner.28 According to the letter, the
cost of the structure was $400,000.29
Mr. Lerner’s letter was not written near the time the Miami
property was built; it was written approximately 12 years after
the structure was completed. Furthermore, according to
petitioner’s own testimony, Mr. Lerner did not bill for the cost
of construction materials or services, nor did he pay them.
Moreover, Mr. Lerner’s letter does not indicate that he consulted
any of the contractors who did the work or that he referenced a
written record or source documents to determine the structure’s
actual cost.
Petitioner has not established that respondent’s
determination that petitioner’s cost basis in the structure was
greater than $214,000 was in error.30
28The parties included this letter as an exhibit in their
stipulation of facts. The stipulation stated that respondent did
not stipulate the truth of the letter’s content.
29We note that the estimated cost provided by Mr. Lerner
($400,000) cannot be reconciled with petitioner’s estimated cost
of $446,000 as asserted on page 10 of his brief, or $445,182 as
asserted on page 13 of his brief, or $446,985.19 as reported on a
depreciation schedule attached to Eureka Field Nursery’s 1985
income tax return.
30Consistent with respondent’s determination, 59 percent or
$126,260 of petitioner’s $214,000 cost basis in the structure is
allocated to business use, while the remaining 41 percent or
$87,740 is allocated to personal use.
(continued...)
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