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OPINION
Respondent disallowed the claimed employee business expenses
and determined that petitioner was liable for an accuracy-related
penalty. Petitioner asserts that he may deduct MBA-related
expenses and other non-education business expenses, and that he
is not liable for the penalty because he acted with reasonable
cause and in good faith in taking the deductions. We address
each issue in turn. We begin with the burden of proof.
A. Burden of Proof
At trial, the Court found, and petitioner conceded, that
petitioner failed to comply with reasonable requests by
respondent for witnesses, information, documents, meetings, and
interviews.10 See Snyder v. Commissioner, T.C. Memo. 2001-255
(citing H. Conf. Rept. 105-599, at 240-241 (1998), 1998-3 C.B.
747, 994-995). Accordingly, section 7491(a) does not shift the
burden of proof to respondent, and petitioner bears the burden to
10This burden may shift to the Commissioner to disprove
entitlement to a claimed deduction if the taxpayer introduces
“credible evidence” complete with the necessary substantiation
and documentation sufficient to fulfill the sec. 7491(a)
requirements. See Snyder v. Commissioner, T.C. Memo. 2001-255
(citing H. Conf. Rept. 105-599, at 240-241 (1998), 1998-3 C.B.
747, 994-995). We held at trial that petitioner did not meet his
sec. 7491(a) obligations because he missed several meetings with
respondent and failed to respond to several inquiries.
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Last modified: May 25, 2011