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the proposal did not include the work of applying one Malarkey
Roofing Products #502 cap sheet and one #601 sheet to existing
stucco walls. In September 1994, petitioner paid Gudgel/Yancey
Roofing $27,000 for this work. Mr. Graham inspected the
completed work, which had a warranty of 10 years.
On his 1994 tax return, petitioner deducted $65,319 as
repairs to Carmichael Village. Respondent disallowed $32,7325
and determined that these amounts were capital expenditures.
Payment to Royal Roofing, Inc.
In November 1995, petitioner paid $30,000 to Royal Roofing,
Inc.
On his 1995 tax return, petitioner deducted $84,815 as
repairs for Carmichael Village. Respondent reduced this amount
by $72,887 and determined that petitioner had not established
that the expenses were ordinary and business expenses. Of this
amount, respondent determined that the $30,000 paid to Royal
Roofing was not a “repair” because petitioner had not provided
sufficient documentation to establish the nature of the work.
5 This amount represented $27,000 paid to Gudgel/Yancey
Roofing plus $5,732 of other repairs, which the parties have
stipulated are not deductible as repairs or capital items in
1994.
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