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$1,830,260.6 Petitioner did not provide a more precise accounting
of the remaining losses.
Deductions are a matter of legislative grace, and the
taxpayer bears the burden of proving entitlement to any
deductions claimed. Rule 142(a);7 INDOPCO, Inc. v. Commissioner,
503 U.S. 79, 84 (1992). The taxpayer is required to identify
each deduction available and show that all requirements have been
met. New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440
(1934). Petitioner concedes that she bears the burden of proof.
A shareholder of an S corporation can deduct a proportionate
share of the corporation’s net operating loss to the extent the
loss does not exceed the sum of the adjusted basis of the
shareholder’s stock in the corporation and any indebtedness of
the S corporation to the shareholder. Sec. 1366(d)(1). Here,
under section 1366, petitioner is not entitled to deduct in 1998
a business carryover loss from 1992. She failed to present any
evidence to establish her basis in the stock of the S
corporation, T.G. Morgan, Inc. Further, there is no evidence
that the business was indebted to her. Without basis in her
6 On briefs, petitioner made separate references to the
total as equaling $1,830,250 and $1,830,225; there is no
explanation in the record for these discrepancies.
7 Unless otherwise indicated, all section references are
to the Internal Revenue Code in effect for the year at issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
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