Elliot Virgil Wilkerson - Page 14

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                    3.  Schedule E Deductions                                         
               Section 212(2) allows a deduction for all ordinary and                 
          necessary expenses paid or incurred during the taxable year for             
          the management, conservation, or maintenance of property,                   
          including real property, held for the production of income.  Sec.           
          1.212-1(h), Income Tax Regs.                                                
               The evidence indicates that petitioner maintains several               
          rental properties.  Petitioner thus claims depreciation as well             
          as various expense deductions associated with his rental                    
               Petitioner, however, offered no evidence whatsoever to                 
          substantiate deductions for the claimed amounts.  Petitioner                
          failed to produce any records or documents that any of the                  
          expenses were allegedly paid or incurred with respect to his                
          rental properties.  Moreover, petitioner failed to present any              
          testimony, however slight, to explain the expenses listed on                
          Schedule E to give us any basis upon which we could estimate such           
          deductions.  On the basis of his revised Form 1040, petitioner              
          would have this Court infer facts not in the record to prove that           
          he incurred legitimate rental expenses.  The burden, however, is            
          on petitioner to substantiate his claimed deductions.  We hold,             
          therefore, that petitioner failed to meet his burden of proof.              
          Consequently, petitioner is not entitled to deduct depreciation,            
          nor is he entitled to any of his claimed expense deductions.  See           

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