Peter F. & Maureen L. Speltz - Page 12

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          necessary substantiation and documentation.  See sec. 7491(a);              
          Higbee v. Commissioner, 116 T.C. 438, 440-443 (2001).  To shift             
          the burden, the taxpayer must also have complied with                       
          requirements to cooperate with the Commissioner’s reasonable                
          requests for witnesses, information, documents, meetings, and               
          interviews.  Sec. 7491(a)(2).  The taxpayer has the burden to               
          prove the requirements have been met.  Snyder v. Commissioner,              
          T.C. Memo. 2001-255 (citing H. Conf. Rept. 105-599, at 240-241              
          (1998), 1998-3 C.B. 747, 994-995).                                          
               Petitioners reasonably complied with respondent’s requests             
          for information, documents, and meetings.  Petitioners also                 
          produced credible evidence to establish that Mr. Speltz worked a            
          sufficient number of hours and the nature of the activities he              
          performed.7  Accordingly, we find that section 7491 shifts the              
          burden of proof to respondent.  Respondent therefore bears the              
          burden of proving that petitioners are not entitled to exclude or           
          deduct Mr. Speltz’s reimbursements for insurance premiums and               
          medical expenses.                                                           
          II. Excludability of Medical Premiums and Reimbursements                    
               Gross income generally includes all income from whatever               
          source derived.  Sec. 61(a).  This section has been interpreted             

               7Petitioners conceded that some of the hours Mrs. Speltz               
          noted were personal and could not be counted.  Mrs. Speltz                  
          subtracted those hours from the tabulation of the hours Mr.                 
          Speltz spent performing daycare-related tasks.                              

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