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here, deductions for home mortgage interest of $2,0401,
charitable contributions of $1,300, job expenses of $1,290, and
other miscellaneous itemized deductions of $7,575 are claimed.
In the notice of deficiency, respondent disallowed the
Schedule A deductions listed above. Respondent further
determined that petitioner is liable for an accuracy-related
penalty under section 6662(a). Because allowable itemized
deductions were less than the standard deduction, respondent
disallowed those otherwise allowable itemized deductions and
allowed petitioner the standard deduction. Respondent also
allowed petitioner a Lifetime Learning Credit of $746.
Discussion
The issues in this case arise from the disallowance of
itemized deductions claimed on petitioner’s Federal income tax
return.2 As has been noted in countless cases, deductions are a
matter of legislative grace and are allowable only as
specifically provided by statute. See INDOPCO, Inc. v.
1 Petitioner lived in a rented apartment during 2000. The
home mortgage interest deduction claimed on his return consists,
in part, of tuition expenses, books, supplies, and instruments.
Petitioner now concedes that he is not entitled to the deduction.
2 Respondent bears the burden of production with respect to
the imposition of the sec. 6662(a) penalty. Sec. 7491(c).
Otherwise, under the circumstances, petitioner bears the burden
of proof on the issues here in dispute. Sec. 7491(a); Rule
142(a).
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Last modified: May 25, 2011