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Petitioners have offered no evidence to show that the
replacement of the engine and tires of the truck was a result of
theft damage rather than the 150,000 miles accumulated before the
truck was stolen. See Newton v. Commissioner, 57 T.C. 245, 248-
249 (1971); Leslie v. Commissioner, T.C. Memo. 1984-61. Nor have
petitioners shown that the replacement of the engine and tires
did not exceed the damage or cause the truck to be restored to a
condition better than that which it was in immediately before the
theft. See sec. 1.165-7(a)(2)(ii), Income Tax Regs. They
provided no evidence regarding the replacement of the stereo and
“glass”. Among the receipts presented by petitioners, however,
is one for $354.75 for the repair of the seats of the truck. The
Court accepts the receipt as evidence of damage to the truck as a
result of the theft, and the amount on the receipt is deductible
to the extent permitted by section 165(h)(1) and (2).
The Accuracy-Related Penalty Under Section 6662
Section 7491(c) imposes the burden of production in any
court proceeding on the Commissioner with respect to the
liability of any individual for penalties and additions to tax.
Higbee v. Commissioner, 116 T.C. 438, 446 (2001); Trowbridge v.
Commissioner, T.C. Memo. 2003-164, affd. 378 F.3d 432 (5th Cir.
2004).
In order to meet the burden of production under section
7941(c), the Commissioner need only make a prima facie case that
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