- 6 - lease of vehicle; (2) $4,000 of the claimed $6,000 rental deduction; and (3) the full amount of the $4,742 claimed interest deduction. After the notice of deficiency was issued and a petition was filed, respondent concluded that the notice did not accurately reflect the correct adjustments. Apparently some confusion was created by the return, since petitioner listed other property on Schedule E, Supplemental Income and Loss, and also incorrectly reported the purchase of a “warehouse” on Form 8824. In his answer respondent claimed that the realized gain on the sale of the San Diego condominium was composed of a capital gain of $91,424 and an ordinary gain of $20,291. The total of these two amounts, $111,715, was reported on the 2001 return as realized, but deferred gain. This claimed adjustment results in a $7,926 increase in the deficiency. Petitioner agrees to the correctness of this revised computation but nevertheless argues that the gain should be deferred or that she is entitled to a theft or casualty loss. Discussion I. Burden of Proof Generally, the burden of proof is on the taxpayer. Rule 142(a)(1). Under section 7491, the burden of proof shifts from the taxpayer to the Commissioner if the taxpayer produces credible evidence with respect to any factual issue relevant toPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Next
Last modified: May 25, 2011