- 7 - know or were not sure what each check was for. As to the remainder of the improvements, Mr. Bettencourt admitted at trial that he was unable to ascertain the exact amounts spent by Mrs. Hatch in renovating the residence. He also was unable to establish the year each of the improvements was supposedly made. The written evidence regarding the claimed improvements was vague at best. Mr. Bettencourt is a certified public accountant and should have known that such improvements should have been documented if, as petitioners contend, the expenditures constituted capital expenditures made by Mrs. Hatch as a gift to petitioners. When asked why he did not maintain a log of the improvements, Mr. Bettencourt only reasoned that he did not because they were “arm’s length” transactions between siblings, and “they would write things down on a cash register tape, and it would be hard for us to have a record”. The Court is not satisfied with this explanation as it fails to address the principal issue as to whether the improvements constituted capital items, and whether they were intended as gifts to petitioners. Petitioners have failed to establish that the expenses should be added to the residence’s adjusted basis.Page: Previous 1 2 3 4 5 6 7 8 9 10 Next
Last modified: May 25, 2011