David M. Priestly, Jr. - Page 10

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          produce records does not relieve the taxpayer of the burden of              
          proof.”).  Certain expenses, e.g., interest, real estate taxes,             
          items paid by check or credit card, etc., can be substantiated by           
          records maintained by third parties.  If the taxpayer’s own                 
          records are not available, we expect the taxpayer to make some              
          attempt to obtain substantiating records from third parties in              
          those situations where it is reasonable to expect that third                
          party records exist.  Cf. Gizzi v. Commissioner, 65 T.C. 342, 345           
          (1975); Cook v. Commissioner, T.C. Memo. 1991-590.                          
               Petitioner admits that he has few, if any, records that                
          substantiate the deductions claimed on the Schedules C.                     
          According to petitioner, most, if not all, of the records that              
          would substantiate the deductions here in dispute were seized in            
          the search of his residence.  We note that the search of                    
          petitioner’s residence occurred after petitioner’s 1988 return              
          had been examined and the resulting deficiency, additions to tax,           
          and interest had been assessed.  Petitioner describes the                   
          examination as “uncontested” and does not claim that                        
          substantiating records were produced for respondent’s agent                 
          during the course of that examination.  Furthermore, to the                 
          extent that substantiating records exist and were in his                    
          possession at the time of the examination, he does not explain              
          why those records were not provided to respondent’s examining               

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