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Schedule A, Itemized Deductions. Other adjustments made in the
notice of deficiency are not in dispute.
Discussion
Burden of Proof
As a general rule, determinations made by the Commissioner
in the notice of deficiency are presumed to be correct, and the
taxpayer bears the burden of proving otherwise. See Rule 142(a);
Welch v. Helvering, 290 U.S. 111, 115 (1933). Moreover, it is
settled that “‘an income tax deduction is a matter of legislative
grace and that the burden of clearly showing the right to the
claimed deduction is on the taxpayer.’” INDOPCO, Inc. v.
Commissioner, 503 U.S. 79, 84 (1992) (quoting Interstate Transit
Lines v. Commissioner, 319 U.S. 590, 593 (1943)). Pursuant to
section 7491(a), if the taxpayer introduces credible evidence
with respect to any factual issue relevant to ascertaining the
taxpayer’s liability for tax, the burden of proof is placed on
the Commissioner with respect to that issue. For the burden of
proof to shift to the Commissioner, however, the taxpayer must
cooperate with reasonable requests by the Commissioner for
witnesses, information, documents, meetings, and interviews.
See sec. 7491(a)(2)(B); Higbee v. Commissioner, 116 T.C. 438,
441 (2001). Petitioners failed to satisfy this requirement
insofar as they refused to meet with respondent’s counsel before
trial, refused to provide respondent’s counsel with copies of
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