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petitioner’s list of the tools’ reasonable used values. The
pictures, however, were taken on January 1, 2004, in preparation
for trial, and they do not provide evidence of petitioner’s cost
when the tools were new. The Cohan rule should not be used as a
substitute for petitioners’ burden of proof. Reinke v.
Commissioner, 46 F.3d 760, 764 (8th Cir. 1995) (citing Coloman v.
Commissioner, 540 F.2d 427, 431-432 (9th Cir. 1976), affg. T.C.
Memo. 1974-78)), affg. T.C. Memo. 1993-197. Because petitioners
have not provided any information that would help us estimate
their basis in the tools, the Cohan rule is inapplicable.
Consequently, the amount paid by IMC for petitioner’s tools
should be treated as long-term capital gain by petitioners, and
it is includable in petitioners’ gross income for the years in
which the amounts were received. Based on the inventory list and
petitioner’s credible testimony, it appears that petitioner
transferred ownership of most of his tools in 1996. As a result,
we shall allocate $19,371.25 (the total amount IMC paid
petitioner in 1996) to 1996 for the sale of the tools. The
inventory list that petitioner created at the beginning of 1997
indicates that he sold $23,140.50 worth of old tools to IMC in
1996. However, petitioner was paid only $19,371.25 in 1996. We
believe IMC purchased $3,769.25 (the difference between
$23,140.50 and $19,371.25) worth of tools in 1997. The inventory
list petitioner created in early 1998 indicates that petitioner
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