-4- (f), by filing a Form 8857, Request for Innocent Spouse Relief (request). Respondent denied Butler’s request, determining that she signed the joint return despite knowing about the item giving rise to the deficiency. OPINION A. Deficiency Determination The burden of proof is on petitioners to show that respondent’s determinations set forth in the notice of deficiency are incorrect. Rule 142(a)(1); Welch v. Helvering, 290 U.S. 111, 115 (1933). Deductions are strictly a matter of legislative grace, and petitioners must show that their claimed deductions are allowed by the Code. Rule 142(a); New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440 (1934); Welch v. Helvering, supra at 115. In certain circumstances, if the taxpayer introduces credible evidence with respect to a factual issue relevant to ascertaining the taxpayer’s proper tax liability, section 7491(a)(1) places the burden of proof on the Commissioner. Sec. 7491(a)(1); Rule 142(a)(2). For the burden to be placed on the Commissioner under section 7491(a)(1), the taxpayer, inter alia, must comply with the substantiation and record-keeping requirements of the Internal Revenue Code (Code). Sec. 7491(a)(2)(A) and (B). We conclude that the burden of proof is not upon respondent because petitioners have failed to introducePage: Previous 1 2 3 4 5 6 7 8 9 10 NextLast modified: November 10, 2007