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prepare their 1996 return. Petitioners signed but did not review
the 1996 return as prepared by Mr. Nunez.
D. The Notice of Deficiency
In the notice of deficiency, respondent determined that
petitioners overstated the fair market value of their noncash
charitable contributions. In the notice, respondent determined
that the fair market value of the Winter Haven property was
$155,000 and that the fair market value of the boat was $500.
Thus, respondent disallowed $54,500 ($45,000 for the Winter Haven
property and $9,500 for the boat) of petitioners’ $110,000
noncash charitable contributions for 1996.3
Discussion
In general, the determinations of the Commissioner in a
notice of deficiency are presumed correct, and the burden is on
the taxpayer to show that the determinations are incorrect. Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933).4
A. Charitable Contributions
Section 170(a)(1) allows a deduction for charitable
3 At trial, petitioners and respondent agreed that the fair
market value of the Winter Haven property was $183,000.
Accordingly, petitioners are allowed a charitable deduction with
respect to the Winter Haven property in the amount of $83,000
($183,000 fair market value less the $100,000 sales price).
4 Sec. 7491 does not apply in this case to shift the burden
of proof to respondent because petitioners neither alleged that
sec. 7491 was applicable nor established that they fully complied
with the requirements of sec. 7491(a)(2).
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