- 4 - as the other itemized deductions claimed in the 2002 Schedule A that were not subject to the two-percent floor imposed by section 67(a). Respondent issued to petitioners a notice of deficiency (notice) for their taxable year 2002. In that notice, respon- dent, inter alia, disallowed $33,415.432 and allowed $2,142.57 of the total $35,558 of job expenses that petitioners claimed in the 2002 Schedule A prior to the reduction required by section 67(a). Of the $2,142.57 allowed in the notice, $1,865.39 was for union dues and $277.18 was for tool expenses. In the notice, respon- dent reduced the $2,142.57 that respondent allowed by two percent of petitioners’ adjusted gross income (i.e., by $1,946) and permitted petitioners to deduct the balance (i.e., $196.57) as job expenses. Discussion Petitioners bear the burden of proving that the determina- tions in the notice are erroneous.3 Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933). Moreover, deductions are a matter of legislative grace, and petitioners bear the burden of 2In the notice, respondent rounded to the nearest dollar the dollar amount of the disallowed job expense deduction. 3Petitioners do not claim that the burden of proof shifts to respondent under sec. 7491(a). In any event, petitioners have failed to establish that they satisfy the requirements of sec. 7491(a)(2). On the record before us, we find that the burden of proof does not shift to respondent under sec. 7491(a).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