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finds petitioner failed to prove he contributed $19,628 to KCP in
2001.
To substantiate his purported 2001 capital account of
$81,806, petitioner produced a typed statement listing his
capital contributions. The statement contradicted KCP’s returns
and the stipulated facts by claiming petitioner made capital
contributions to KCP in: (1) 1986 through 1998, years before KCP
was formed; and (2) 1994 and 1995, years when petitioner was not
a direct partner of KCP.
Dr. Karason, a 30-percent owner of KCP since 1989, testified
that he knew nothing about KCP or its operations. He also
admitted he did not know when KCP was formed, when he became a
partner, how he acquired an interest, how much money, if any, he
contributed, whether KCP had a bank account, and whether KCP had
ever distributed stocks, bonds, or real estate to him. To this
extent, the Court believes Dr. Karason’s testimony.
Petitioner admitted that respondent repeatedly requested
documentation from him and his attorney to support his purported
basis in KCP, and he was aware it was his responsibility to prove
such basis. He offered only his self-serving testimony, and he
failed to produce any documentation to substantiate his adjusted
basis in KCP. For the foregoing reasons, this Court finds
petitioner is not entitled to deduct $31,689 as passthrough
losses from KCP in 2001.
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Last modified: November 10, 2007