- 8 - At trial, petitioner made the following concessions: (1) For 1997, the miscellaneous itemized deduction claimed for car and truck expenses incurred by petitioner as an employee of CSR is overstated to the extent that petitioners failed to take into account mileage reimbursements paid to petitioner by CSR (according to the stipulation of facts, the deduction, if otherwise allowable, is limited to $4,383.30); and (2) for 1997 and 1998, petitioner concedes that petitioners are not entitled to the deductions claimed on the Schedules C. All of the issues in this case arise from the disallowance of deductions claimed on petitioners’ Federal income tax returns. As has been noted in countless cases, deductions are a matter of legislative grace and are allowed only as specifically provided by statute. See INDOPCO, Inc. v. Commissioner, 503 U.S. 79, 84 (1992); Interstate Transit Lines v. Commissioner, 319 U.S. 590, 593 (1943); Deputy v. du Pont, 308 U.S. 488, 493 (1940); New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440 (1934). With the exception of the discussion relating to the section 6662(a) penalty, this fundamental principle of Federal income taxation informs our analysis and resolution of each of the disputed issues in this case as set forth below.2 2 Respondent bears the burden of production with respect to the imposition of the sec. 6662(a) penalty for each year in issue. Sec. 7491(c). Otherwise, under the circumstances, petitioner bears the burden of proof on all issues in this case. Sec. 7491(a); Rule 142(a).Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Next
Last modified: May 25, 2011