M. Michael Stewart - Page 8

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          ascertaining the taxpayer’s liability.  Sec. 7491(a)(1).                    
          However, where the Commissioner raises a new matter or claims an            
          increase in the deficiency, the burden of proof is on the                   
          Commissioner.  Rule 142(a)(1); Achiro v. Commissioner, 77 T.C.              
          881, 889-890 (1981); Burris v. Commissioner, T.C. Memo. 2001-49;            
          Jamerson v. Commissioner, T.C. Memo. 1986-302.                              
               As to the adjustments set forth in the notice of deficiency,           
          petitioner has neither argued that the burden of proof should               
          shift nor satisfied the criteria that would cause the burden of             
          proof to shift.  As to petitioner’s alternative position that               
          there was a theft loss, petitioner did not raise this issue until           
          trial; therefore petitioner did not satisfy the requirements of             
          section 7491(a)(2) (complied with requirements to substantiate              
          any item and maintained records required and cooperated with                
          reasonable requests for information, documents, etc.), and the              
          burden of proof remains with petitioner.  As to the remaining               
          issues, given the lack of documentation and information provided            
          by petitioner, we conclude that the burden of proof remains with            
          her with respect to all adjustments determined in the notice of             
          deficiency.  As to the burden of proof with respect to the                  
          nonrecognition of gain, including the adjustment claimed in                 
          respondent’s answer, petitioner has agreed that respondent’s                
          computation of the gain is correct and there is otherwise no                







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