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ery of the alleged custom house theft loss, the amount of the
alleged custom house theft loss, and the absence at the end of
2000 of a reasonable prospect of recovery of the alleged custom
house theft loss to be questionable, inconsistent with certain
other evidence, conclusory, vague, and/or general. We shall not
rely on such testimony to establish the facts with respect to
such matters. On the record before us, we find that petitioner
did not introduce credible evidence with respect to the factual
issues presented under section 165. Having found that petitioner
did not introduce credible evidence with respect to such factual
issues, we need not resolve the dispute between the parties over
whether petitioner has complied with the applicable requirements
of section 7491(a)(2). On the record before us, we find that the
burden of proof does not shift to respondent under section
7491(a)(1) with respect to any factual issues presented under
section 165.
We turn next to whether petitioner is entitled to deduct
under section 165 for taxable year 2000 the alleged custom house
theft loss. Section 165(a) allows a deduction for any loss
sustained during a taxable year and not compensated for by
insurance or otherwise. Section 165(c)(3) limits the deduction
allowed by section 165(a) in the case of an individual to a loss
that arises from, inter alia, theft. The amount of a loss that a
taxpayer is entitled to deduct under section 165 is the lesser of
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