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thereto; and (3) has cooperated with reasonable requests by
respondent for information relating to the item in question.
Sec. 7491(a)(1) and (2); Rule 142(a).
Petitioners’ failure to cooperate with respondent during the
audit of the tax years at issue precludes a shift in the burden
of proof from petitioners to respondent with respect to the
factual issues before us. Sec. 7491(a)(2)(B). Further, during
respondent’s audit, petitioners failed to provide books and
records relating to the cost basis in their residence, and
petitioners failed to produce credible evidence with regard to
the value of the van. See infra. Generally, for purposes of
section 7491(a)(2)(B), later cooperation by taxpayers will not
act to cure prior noncooperation at examination or Appeals. H.
Conf. Rept. 105-599, at 239 (1998), 1998-3 C.B. 747, 993-994.
The burden of proof with respect to the amount of gain
petitioners realized on the sale of their residence and the
amount of petitioners’ charitable deduction relating to the van
is not shifted to respondent and remains on petitioners.
Gain on Sale of Petitioners’ Residence
For 2000, under sections 61 and 1001, gain on the sale or
disposition of a personal residence is included in gross income,
subject to an exclusion, for married taxpayers filing joint tax
returns, of up to $500,000. Sec. 121(a) and (b)(2).
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