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the claimed deductions.6 See Rule 142(a); New Colonial Ice Co.
v. Helvering, 292 U.S. 435, 440 (1934); Welch v. Helvering, 290
U.S. 111, 115 (1933). We now turn to our analysis of the
disputed deductions.
Alleged Abandonment of the Vernon Property
Respondent contends that the Vernon property is treated for
Federal income tax purposes as the property of petitioner’s
bankruptcy estate (the bankruptcy estate) upon the commencement
of the bankruptcy case pursuant to section 1398 and,
consequently, that petitioners did not realize a loss upon any
disposition of the Vernon property by the bankruptcy estate in
2000. Petitioners contend that the bankruptcy estate abandoned
the Vernon property to Herring National Bank in 2000 and that
petitioners acquired the right to recognize a related loss when
petitioner “purchased all assets and claims of his bankruptcy
estate” in a foreclosure sale on February 1, 2004.
The record does not support petitioners’ contention that the
bankruptcy estate abandoned the Vernon property in 2000. Rather,
the parties stipulated that Herring National Bank foreclosed its
lien on the Vernon property on August 7, 2001, and petitioners
have offered no evidence that the bankruptcy estate abandoned the
Vernon property before the foreclosure. Furthermore, the
6We note that petitioners have made no contentions with
respect to sec. 7491(a).
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