- 17 -
Stern or anyone else involved with the corporation or PTSI. Nor
did he produce other credible evidence establishing that a theft
loss occurred. Accordingly, petitioner has not met his burden of
proof and, therefore, is not allowed a deduction under section
165(e).
Issue 4. Whether Respondent Is Estopped From Asserting a
Deficiency Against Petitioner
Respondent issued petitioner a notice of deficiency on
November 1, 2004. On December 27, 2004, respondent sent
petitioner a “closing notice”, which states: “we were able to
clear up the differences between your records and your payers’
records. * * * If you have already received a notice of
deficiency, you may disregard it. You won’t need to file a
petition with the United States Tax Court”.
Respondent’s change in position raises the issue of
equitable estoppel against respondent. “Equitable estoppel is a
judicial doctrine that ‘precludes a party from denying his own
acts or representations which induced another to act to his
detriment.’” Hofstetter v. Commissioner, 98 T.C. 695, 700 (1992)
(quoting Graff v. Commissioner, 74 T.C. 743, 761 (1980), affd.
673 F.2d 784 (5th Cir. 1982)). To apply equitable estoppel
against the Government, however, we must find, inter alia, that
the claimant relied on the Government’s representations and
suffered a detriment because of that reliance. See Norfolk S.
Corp. v. Commissioner, 104 T.C. 13, 60 (1995), affd. 140 F.3d 240
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011