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Other Schedule C Activities
There were no sales of timber or firewood with respect to
petitioner’s timber and firewood sales activity for 1994, because
“the thing fell apart”. His “venture capital” health food and
resort enterprise “never got off the ground.” The only items in
petitioner’s possession to show his involvement in an oil and gas
venture were copies of two uncleared checks that he showed to
respondent’s counsel before trial.
Discussion
The Commissioner’s deficiency determinations are presumed
correct, and taxpayers generally have the burden of proving that
the determinations are incorrect. Rule 142(a); Welch v.
Helvering, 290 U.S. 111, 115 (1933). Under certain
circumstances, however, section 7491(a) may shift the burden to
the Commissioner with respect to a factual issue affecting
liability for tax. Petitioner did not present evidence or
argument that he satisfied the requirements of section 7491(a),
and, therefore, the burden of proof does not shift to respondent.
Deductions for Dependency Exemptions
Petitioner argues that he is entitled to dependency
exemption deductions for his son and daughter for the years at
issue and for Stacy Brown for 1994 and 1995.
Section 151(c)(1) allows a taxpayer to claim an exemption
deduction for each dependent as defined in section 152 whose
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Last modified: November 10, 2007