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Cabber or Mr. Green whether Mr. Cabber was an architect.
Regarding Mr. Green’s representations as to the “fine quality” of
his houses, respondent asserts that even petitioners have
conceded such a term is subjective and that Mr. Green believes
that he provided the highest quality work. When petitioners
discovered defects in their house, respondent observes that,
until Mr. Green moved to Las Vegas in 1998, and even after the 1-
year warranty period had expired, he sent repairmen to fix those
defects. Respondent’s ultimate contention is that this is a
contractual dispute, not a criminal matter. In that regard,
respondent notes that this dispute was the subject of a civil
suit, that the civil suit settled with no admission of fault, and
that no criminal complaint was ever filed in this matter.
Finally, respondent addresses this Court’s decisions dealing with
similar situations and asserts that this case is like those in
which this Court has disallowed theft loss deductions.
II. Theft Loss
Deductions are a matter of legislative grace, and the
taxpayer must maintain adequate records to substantiate the
amounts of any deductions or credits claimed. Sec. 6001; INDOPCO
Inc. v. Commissioner, 503 U.S. 79, 84 (1992); sec. 1.6001-1(a),
Income Tax Regs. As a general rule, the Commissioner’s
determination of a taxpayer’s liability in the notice of
deficiency is presumed correct, and the taxpayer bears the burden
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