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meetings, and interviews, and, if the taxpayer is a corporation,
satisfied the net worth requirements of section
7430(c)(4)(A)(ii).
Respondent admits that petitioners have cooperated
throughout the examination. However, respondent argues that
petitioners have not provided substantiation for certain Schedule
F expense deductions and that petitioners have not produced
credible evidence with respect to whether their exotic animal
breeding operation was an activity engaged in for profit.
We do not need to decide whether petitioners have met all of
the requirements under section 7491 to shift the burden of proof
to respondent. The outcome of this case is based on a
preponderance of the evidence and thus is unaffected by section
7491. See Estate of Bongard v. Commissioner, 124 T.C. 95, 111
(2005) (citing Blodgett v. Commissioner, 394 F.3d 1030, 1035 (8th
Cir. 2005), affg. T.C. Memo. 2003-212, and Estate of Stone v.
Commissioner, T.C. Memo. 2003-309).
II. Section 183(a) Deductions
A. In General
Section 183(a) provides that if an activity is not engaged
in for profit, no deduction attributable to the activity shall be
allowed except as provided in section 183(b). Section 183(b)(1)
authorizes a deduction for any expense that otherwise is
allowable, regardless of profit objective. Section 183(b)(2)
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