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of legislative grace with a taxpayer bearing the burden of
proving entitlement to the deductions claimed. Rule 142(a)(1);
INDOPCO, Inc. v. Commissioner, 503 U.S. 79, 84 (1992). Taxpayers
bear the burden of substantiating the amount and purpose of any
claimed deduction. See Hradesky v. Commissioner, 65 T.C. 87
(1975), affd. per curiam 540 F.2d 821 (5th Cir. 1976). Taxpayers
are required to maintain sufficient records to establish the
amounts of income and deductions. Sec. 6001; Higbee v.
Commissioner, 116 T.C. 438, 440 (2001); sec. 1.6001-1(a), Income
Tax Regs.
It was reasonable for respondent to refuse to concede the
adjustments until he had received and verified adequate
substantiation for the items in question. See Harrison v.
Commissioner, 854 F.2d 263, 265 (7th Cir. 1988), affg. T.C. Memo.
1987-52; Sokol v. Commissioner, supra at 765; Beecroft v.
Commissioner, T.C. Memo. 1997-23; Simpson Fin. Servs., Inc. v.
Commissioner, T.C. Memo. 1996-317; McDaniel v. Commissioner, T.C.
Memo. 1993-148. Petitioner’s counsel met with respondent’s
Appeals officer on March 8, 2005. He provided documentation to
the Appeals officer to substantiate some of petitioner’s claimed
business expense deductions and head of household filing status
at the conference. Petitioner’s counsel, by letters dated March
9 and May 10, 2005, provided additional supporting documentation
to substantiate some of petitioner’s remaining claims. The
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Last modified: May 25, 2011