Braun Michael and Twanda B. Cameron - Page 9

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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                  
               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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