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which he claims he is entitled to deduct under section 165.
Assuming arguendo that petitioner had carried his burden of
showing (1) that he discovered the alleged custom house theft
loss in 2000 and (2) the amount of the loss which he claims he is
entitled to deduct under section 165, we turn now to whether at
the end of 2000 petitioner had a reasonable prospect of recovery
of the alleged custom house theft loss. The determination of
whether there is a reasonable prospect of recovery is made upon
facts known or reasonably foreseeable at the end of the taxable
year for which the theft loss deduction is claimed. Ramsay
Scarlett & Co. v. Commissioner, 61 T.C. at 811-812.
At trial, petitioner testified that as a result of the
discovery that he conducted in connection with the custom house
litigation counterclaim he became aware that Mona Builders had
only $75,000 in assets and was thinly capitalized (Mona Builders’
alleged financial condition). Based on that testimony, peti-
tioner argues that Mona Builders was always thinly capitalized
and that therefore petitioner never had a reasonable prospect of
recovery from Mona Builders of the alleged custom house theft
loss.
We found petitioner’s testimony with respect to Mona Build-
ers’ alleged financial condition to be questionable, conclusory,
vague, and general. That testimony also appeared to be inconsis-
tent with Mona Builders’ ability on May 29, 2003, to purchase the
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