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Children’s Hospital, the Boy Scouts of America, and Shiloh
Baptist Church). After reviewing this list and comparing it with
petitioners’ check receipts, we conclude that petitioners
substantiated $2,910.80 for 1996 and $249.29 for 1997.
Accordingly, petitioners are entitled to deduct these amounts.
We note that petitioners did not offer any documentation or
testimony as to the value of the stripping machines used for the
repavement project. Because we are unable to decide this value,
we hold that petitioners are not entitled to any deduction
therefor.
Therefore, petitioners are entitled to charitable
contribution deductions for 1996 and 1997 of $3,835.80 and
$249.29, respectively.
2. State Income Tax Refund
Refunds of State taxes are includable in gross income in the
year received to the extent that they reduced a taxpayer’s
Federal income tax liability for a prior taxable year. Secs.
61(a); 111(a); sec. 1.111-1(a), Income Tax Regs.
In the notice of deficiency, respondent determined that
petitioners failed to include in gross income for 1997 $2,552
representing their 1996 Maryland State Income Tax refund.
Petitioners contend that they did not receive a refund in
that amount from the State of Maryland, and thus should not be
required to include any additional amount as income.
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