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Petitioner petitioned this Court timely with respect to 1993 upon
conclusion of her bankruptcy proceeding. Sec. 6213(f).
Respondent acted within the prescribed limitations period and,
therefore, is sustained on this issue.
The second issue is whether petitioner is entitled to
various Schedule A and Schedule C deductions in excess of amounts
allowed by respondent in the notices of deficiency. Deductions
are a matter of legislative grace. INDOPCO, Inc. v.
Commissioner, 503 U.S. 79, 84 (1992). Petitioner bears the
burden of proof to present adequate documentation to support the
deductions claimed on her returns. Rule 142; Welch v. Helvering,
290 U.S. 111, 115 (1933).6 It is also petitioner’s
responsibility to maintain records sufficient to enable
respondent to determine her correct tax liability. Sec. 6001;
sec. 1.6001-1(a), Income Tax Regs.; Higbee v. Commissioner, 116
T.C. 438 (2001). The taxpayer must substantiate both the amount
and purpose of the claimed deductions. Higbee v. Commissioner,
supra.
6 Sec. 7491, under certain circumstances, places the
burden of production on the Commissioner with respect to a
taxpayer’s liability for taxes, penalties, and additions to tax
in court proceedings arising in connection with examinations
commencing after July 22, 1998. In this case, petitioner does
not contend, nor is there evidence, that the examination of her
returns commenced after July 22, 1998, or that sec. 7491 is
applicable.
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