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was in fact worthless in the year the losses were claimed.
Echols v. Commissioner, supra at 212-213.
Closed and completed transactions and identifiable events
are not limited to divestitures of title or abandonment, the
taxpayer need not be a "party" to the events or transactions, and
the events or transactions need not directly involve the asset in
question. Id. at 213. The requirement of worthlessness is a "de
minimis rule that the taxpayer does not have to prove that a
given asset is absolutely, positively without any value
whatsoever." Echols v. Commissioner, 935 F.2d 703, 708 n.2 (5th
Cir. 1991), revg. and remanding 93 T.C. 553 (1989). A taxpayer
must make a reasonable showing that the asset was in fact
valueless to him at the time selected by the taxpayer--not that
its fair market value necessarily fell to or below zero in that
year. Id. at 708.
We decide this case without regard to the burden of proof.
Accordingly, we need not decide whether section 7491(a)(1) is
applicable in this case. See Higbee v. Commissioner, 116 T.C.
438 (2001).
Respondent's position appears to be that no objective
factors reflect completed transactions and identifiable events
that establish worthlessness of the covenants not to compete in
FYE March 31, 1996. The Court disagrees.
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