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his girlfriend. But even if we accepted petitioner’s testimony
that these people acted as his agents, there are items that have
a hollow ring. For example, petitioner testified that his cell
phone was in his girlfriend’s name. However, deductions are
alleged for two phones.
Ordinarily we would be inclined to simply hold that
petitioner has not carried his burden of proof3 (see Rule 142)
and sustain respondent’s determination. We believe, however,
that most of the problem results from ignorance of any type of
bookkeeping skills and requirements. Furthermore, we are
concerned that, notwithstanding the failures in petitioner’s
case, respondent’s determination that petitioner’s expenses were
59 percent of his gross income is erroneous. During 1998, a
general building contractor’s expenses were approximately 86
percent of the gross income. See Internal Revenue Service,
Statistics of Income Bulletin, p. 30 (SOI) (Summer 2000). We
are, therefore, fairly confident that petitioner did have some
expenses in addition to those allowed by respondent.
In such circumstances, although absolute certainty is
usually impossible, courts have allowed deductions based on a
close approximation but bearing heavily against the taxpayer
3 It would be ludicrous to say that under these circumstances
petitioner is entitled to shift the burden of proof to respondent
under sec. 7491(a). To say the least, he did not maintain
adequate records or present credible evidence. See sec. 7491(a).
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