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Discussion
Generally, the Commissioner’s determinations are presumed
correct, and the taxpayer bears the burden of proving that those
determinations are erroneous. Rule 142(a); Welch v. Helvering,
290 U.S. 111, 115 (1933). The burden of proof may shift to the
Commissioner under section 7491 in certain circumstances. On the
basis of the record, we hold that section 7491(a) does not
operate to place the burden of proof on respondent; in short,
petitioners did not introduce testimony evidence sufficient to
place in doubt the exactitude of the documentary record.
Gross income includes income from whatever source derived
including, but not limited to, life insurance contracts.3 Sec.
61(a)(10). As relevant to this case, any amount which is
received under a life insurance contract on its complete
surrender, and which is not received as an annuity, shall be
included in gross income to the extent it exceeds the investment
in the contract. Sec. 72(e)(1)(A), (5)(A), (C), (E)(ii). The
investment in the contract is defined generally as the aggregate
amount of premiums or other consideration paid for the contract
less amounts previously received under the contract, to the
extent such latter amounts were excludable from gross income.
Sec. 72(e)(6).
3 The parties do not dispute that the policy is a life
insurance contract. See sec. 7702(a).
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Last modified: May 25, 2011