Joel Rappaport - Page 9

                                        - 9 -                                         
          First, in Budner, we held that a taxpayer (partner) may not                 
          deduct payments by a third party (a partnership) unless there is            
          an arrangement for charging the partner.  We found that there was           
          no such arrangement in Budner.  Petitioner contends that CFB’s              
          payment of his expenses was a loan to him, unlike the                       
          circumstances in Budner.  We disagree because petitioner has not            
          shown that he was obligated to repay CFB.                                   
               Second, in Budner, we found no evidence that the expenses              
          the partnership paid for the taxpayer had not been deducted at              
          the partnership level, and thus the expenses at issue could have            
          been improperly deducted twice.  Id.  Petitioner testified and              
          contends that CFB did not deduct the expenses it paid that are at           
          issue in this case.  We disagree.  Petitioner is an experienced             
          C.P.A. who should have known that he is required to keep and                
          produce records to substantiate his claims.  See sec. 6001.  He             
          did not offer CFB returns in evidence.  He did not corroborate              
          his testimony or explain how he knew that CFB did not deduct                
          those items.  Petitioner’s attempt to distinguish Budner is                 
          without merit.                                                              
               We conclude that petitioner may not deduct mortgage                    
          interest, real estate tax, and condominium fees that CFB paid in            

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  Next

Last modified: May 25, 2011