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that a theft, as defined by local law, occurred. See Viehweg v.
Commissioner, 90 T.C. 1248, 1253 (1988); Luman v. Commissioner,
79 T.C. 846, 860 (1982). A loss attributable to a mysterious
disappearance of property does not qualify for deduction as a
theft loss. See Jacobson v. Commissioner, 73 T.C. 610, 613
(1979).
Petitioner claimed a theft loss deduction for property left
behind when he separated from Ms. Stephens in January 1998. At
trial, petitioner’s explanation of the circumstances surrounding
the loss of this property suggest, at best, that the property
mysteriously disappeared.1 Furthermore, his testimony at trial
was in sharp contrast to his testimony at the deposition, where
he testified that Ms. Stephens sold the property. Nothing in the
record suggests a theft has occurred under Texas law. See Tex.
Penal Code Ann. sec. 31.03 (Vernon 2002); Tex. Fam. Code Ann.
secs. 3.001-3.003 (Vernon Supp. 2002). Therefore, petitioner is
not entitled to the theft loss deduction here in dispute.
Respondent’s determination disallowing the theft loss deduction
claimed on petitioner’s 1998 Federal income tax return is
sustained.
1 With respect to the items allegedly stolen, petitioner
testified at trial: “I don’t know what happened to them. I know
I don’t have them.”
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Last modified: May 25, 2011