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totaling $15,396.37.19 As previously stated, petitioner has
failed to meet his burden of proof on this issue, see Rule
142(a)(1); we therefore hold that the J&J Trucking payments of
$15,396.37 are includable in petitioner’s gross income for 1993.
Petitioner admitted that in 1993 he repaid a loan to Bank of
America of $17,300. Petitioner did not establish the source of
the funds he used to repay this loan. Petitioner testified that
the living trust either had the money on hand or borrowed it to
repay the loan. After reviewing the trust bank account
statements on and around the loan repayment date, we cannot find
a withdrawal or check that approximates the $17,300 payoff
amount. Nor has petitioner provided any loan documentation to
support his suggestion that the Bank of America loan was
satisfied using newly borrowed funds. Respondent determined that
petitioner used unreported income to repay the loan. Because
petitioner has failed to meet his burden of establishing the
source of the funds used to repay the loan, see Rule 142(a)(1),
we sustain respondent’s determination that petitioner used
unreported income to repay the loan.
For 1994, petitioner filed separate individual and fiduciary
income tax returns, reporting all his business and personal
income on the fiduciary return. The trust bank account
19 This is contrary to respondent’s assertion that J&J
Trucking payments totaled $16,796 for 1993.
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