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B. 5415 S. Broadway Property
As indicated previously, petitioners offered almost no
evidence concerning their purported rental activity involving the
5415 S. Broadway property. In addition, petitioners failed to
substantiate certain rental expenses that respondent had
disallowed. Consequently, we sustain respondent’s determinations
for 1992 and 1993 with respect to that property. Rule 142(a)(1).
C. Prior Year Disallowed Passive Losses
Petitioners have failed to establish that they are entitled
to deduct prior year unallowed passive losses of $1,345.
Consequently, we sustain respondent’s determination disallowing
their deduction for 1993 of prior year passive losses. Rule
142(a).
VI. 1992 and 1993 NOL Deductions
Petitioners claimed NOL deductions for 1992 and 1993 on the
basis of certain NOL carryforwards that petitioners had computed
from 1990 and 1991. The 1990 and 1991 NOL carryforwards they had
computed arose from Schedule C expenses they deducted with
respect to their purported nightclub/restaurant business at the
5401-9 S. Broadway property. As discussed supra in part II,
petitioners had not opened and did not operate any restaurant or
nightclub on the property during 1990 and 1991. In addition,
nearly all the 1990 and 1991 Schedule C expenses were direct and
indirect costs of producing petitioner’s nightclub/restaurant
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