Hunt & Sons, Inc. - Page 9




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          preponderance of the evidence rather than on an allocation of the           
          burden of proof.                                                            
               With respect to the White Rock Road, Roseville Road, and               
          Mosquito Road properties, only petitioner introduced direct                 
          evidence regarding fair market rental value.  In lieu of offering           
          evidence, respondent asks us to infer that the rents on these               
          properties were overstated in the same overall proportion as the            
          rents on the other three properties.  We decline to do so.  As              
          discussed infra, petitioner has established by a preponderance of           
          the evidence that the rents paid on these properties did not                
          exceed their fair market rental values.                                     
          II. Fair Market Rental Value of the Properties                              
               In his notice of deficiency, respondent disallowed                     
          petitioner’s rental deductions, in the gross amounts shown on the           
          following table, with respect to the six properties under review:           

                                     1996       1997       Total                      
                Rent claimed      $304,800    $327,700   $632,500                     
                Rent disallowed                                                       
                by respondent     (203,600) (211,620) (415,220)                       
                Rent allowed by                                                       
                respondent        101,200     116,080    217,280                      
          Respondent determined that the excess rents petitioner paid                 
          constituted disguised dividends.  Respondent claims that                    
          petitioner’s purpose in disguising the dividends as rental                  








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