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Burden of Proof
In general, the Commissioner’s determinations set forth in a
notice of deficiency are presumed correct, and the taxpayer bears
the burden of showing that the determinations are in error. Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933). Pursuant
to section 7491(a), the burden of proof as to factual matters
shifts to the Commissioner under certain circumstances.
Petitioners have neither alleged that section 7491(a) applies nor
established their compliance with the requirements of section
7491(a)(2)(A) and (B) to substantiate items, maintain records,
and cooperate fully with respondent’s reasonable requests.
Petitioners therefore bear the burden of proof.
1. Petitioners’ Claimed Deductions
Deductions are a matter of legislative grace, and the
taxpayer bears the burden of proving that he is entitled to any
deduction claimed. Rule 142(a); New Colonial Ice Co. v.
Helvering, 292 U.S. 435, 440 (1934). The taxpayer is required to
maintain records that are sufficient to enable the Commissioner
to determine his correct tax liability. See sec. 6001; sec.
1.6001-1(a), Income Tax Regs.
A. Charitable Cash Contributions
In general, section 170(a) allows as a deduction any
charitable contribution made within the taxable year. A
charitable contribution means a contribution or gift to or for
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Last modified: May 25, 2011