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to have other documents supporting his position, but the
documents were not in his possession at the time of the meeting.
Respondent allowed petitioners until January 25, 2001, to supply
the other documents and organize all the documents according to
the Schedules C to which they related.
Respondent informed the Court of petitioners’ pattern of
delay and requested that the Court continue to hold both motions
under advisement until after January 25, 2001.
In their status report filed January 16, 2001, petitioners
admitted that they received correspondence requesting the
documents be assembled in an organized fashion, but asserted that
the documents were cataloged properly. Further, petitioners
admitted discrepancies existed regarding some invoices but
claimed that the documents presented were sufficient to “warrant
dismissal of all tax liabilities” based on the “Cohan Rule”.2
On January 25, 2001, petitioners failed to submit the other
documents, and for the third time presented respondent with
copies of the same unorganized documents previously presented.
On February 5, 2001, the Court issued an order granting
petitioners’ oral motion for a continuance and denying
respondent’s motion to dismiss the case for failure to prosecute.
The Court ordered petitioners to organize the documents to be
2 The “Cohan Rule” allows for the estimation of certain
expenses in limited situations. See Cohan v. Commissioner, 39
F.2d 540 (2d Cir. 1930); infra pp. 17 and 18.
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