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he did not own Macar Service Corp.; and Ruth Wapnick bought Oxus
Taxi, Inc. in 1986. We disagree. There is no evidence
corroborating his assertions. He did not call his wife or sons
as witnesses. We conclude that the 13 corporations were shams,
and we disregard them for tax purposes.
Petitioner contends that the interest income paid to Oxus
Taxi, Inc. is not taxable to him because his wife reported all of
it. We disagree. After the criminal investigation began,
petitioner’s wife filed an income tax return on which she
reported a gain on the 1988 sale of Oxus Taxi, Inc., stock.
There is no evidence that she reported any interest income paid
to Oxus Taxi, Inc. in the years in issue. Petitioner has not
carried his burden of proving that he is not taxable for income
generated in the name of Oxus Taxi, Inc., in the years in issue.
We conclude that petitioner is taxable on income that he
received from cashing checks, and on the interest and capital
gains with respect to the $400,000 and $600,000 U.S. Treasury
notes.
2. Income From Loans
Petitioner contends that he had no income from lending money
because many of the loans he made were not repaid. A taxpayer
may deduct a bad debt in the year it becomes wholly or partially
worthless. Sec. 166(a)(1) and (2); sec. 1.166-2(a), Income Tax
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