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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
2001.
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