TAX COURT OPINION

Case: Larmonte L. Evans
Docket Number: 18068-08S
Judge: Colvin
Opinion Type: bench
Filed: 11/13/2009
Pages: 8

UNITED STATES TAX COURT WASHINGTON , D.C. 2021 7 LARMONTE L . EVANS , Petitioner, ) v . ) Docket-No . 18068-08S COMMISSIONER OF INTERNAL REVENUE, ) Res ondent O R D E R Pursuant to Rule-152(b), Tax Court Rules of Practice and Procedure, it i s ORDERED that the Clerk of the Court shall transmit to petitioner and to respondent a copy of the pages of the transcript of the proceedings of the above case before Judge Diane L . Kroupa at San Diego, California, on October 29, 2009, containing her oral findings of fact and opinion . . In accordance with the oral findings of fact and opinion, decision will be entered pursuant to Rule 15 5 (Signed ) Diane L. Kroupa Judge Date :' Washington, D .C . November 13, 2009 ',SERVED 01, 16 2009 2 1 'Bench Opinion by Judge Diane L . Kroupa October 29, 200 9 Larmonte L . Evans Docket No . 18068-08 S 3 THE COURT : The Court has decided .to render ora l findings of .fact and opinion in this case, and the following 5 represents the Court's oral findings of fact . and opinion . 6 These oral findings of fact-and .opinion(cid:127)'shall not be relied 7 upon as-precedent in any other case . This proceeding was heard as a small tax cas e 9 pursuant to the provisions of Section 7463 and Rules 170 10 through 175 . All section-references are to-the Interna l 11 Revenue Code for 2006,, the year at issue, and all, Rul e 12 references are,to the Tax Court Rules of Practice and 13 Procedure . 14 This bench opinion is made pursuant to th e 15 authority granted by Section 7459(b) and Rule 152 . 1 6 Larmonte Evans appeared pro se,' and Jimeel,,Hamu d 17 appeared-on behalf,of Respondent . 18 FINDINGS OF FACT 19 .Certain facts have been stipulated . The 20 stipulation of facts, with-,.accompanying exhibits,- are 21 . incorporated by this reference . The facts are so found . 22 Petitioner resided in California at the time he 23 filed the petition in-this cas e 24 Petitioner worked for United Parcel Service (UPS ) 25 in 2006, . earning approximately $48,000 in wages . On the Heritage Reporting Corporation (202)628-4888 ' return for that . year, Petitioner claimed over half of his taxable wages as a. non'-cash-charitable contribution, as well as a $3,824 cash charitable contributionand a $3,762 . casualty and theft loss . Respondent disallowed during examination the claimed deductions because Petitioner faile d -6 to substantiate them . Respondent issued Petitioner a deficiency notice determining a $4,813 deficiency . for . 2006 . Petitioner was able to substantiate $2,494 of-cas h contributions-he made to the Calvary Baptist Church in 2006 . 10 Petitioner asserts that an additional $1,330 of cash wa s 11 given to other churches during the year . 12 With respect to the non-cash,charitabl e 13 contribution amount, Petitioner provided receipts from 14 AMVETS and The Baras Foundation to establish that he made 15 $24,300 of non-cash contributions during 2006 to thes e 16 charities . The receipts .simply show the date . contribute d 17 and the value of the items, but do not detail what was 18 contributed or how the items were valued . Petitioner als o 19 lacks an inventorypof what was donated, . when the. items-were 20 purchased, and how the value was determined on th e 21 contribution date .' Respondent's counsel contacted The Bara s 22 Foundation and learned that their policy was to allow the 23 donor to fill out the receipts themselves and enter their 24 own estimate of the value given . 25 Petitioner claims that his vehicle was "broken Heritage Reporting Corporatio n (202) 628-4888 into" and "tools and equipment" were taken in 2006 to justify the theft loss he claimed .. Petitioner was unable to state the date of the loss, did not file a police report, did not file an insurance claim, and does not have a 5 - detailed list of the items taken . Petitioner , timely filed a petition . OPINION This is primarily a substantiation .case involving whether Petitioner kept accurate records to deduct cas h 10 charitable contributions, non-cash-charitable contributions, 11 and a theft loss in 200 6 12 We begin with two fundamental principles ;of ta x 13 litigation . First, the Commissioner's determinations are 14 generally presumed correct, and .the taxpayer bears th e 15 burden of proving that,those determinations are erroneous . 16 Rule 142(a) .. This principle is not affected by Sectio n 17 7491(a) because Petitioner failed to maintain .adequat e 18 records See Sec . 7491(a) (2) (A) and (B) .see also Higbee v . 19 Commissioner , 116 T .C . 438 (2001) . 20 Second, deductions are a matter of legislativ e 21 grace, and the taxpayer must show :. that he or .she i-s entitled 22 to any deduction claimed . Rule 142(a) ; Welch v . Helvering , 23 290 U .S . 111 (1933) . . This includes the burden of substan- 24 tiation . Hradesky v . Commissioner , 65 T .C . 87, 90 (1975), 25 aff'd . per curiam 540 F .2d 821 (5th Cir . 1976) .. . Substanti a Heritage Reporting Corporation (202) 628-4888 tion means that a taxpayer shall keep such permanent records or books of account as are sufficient to establish th e amount of deductions claimed on the return . Sec . 6001 ; Sec . 1 .6001-1(a), (e), Income Tax Regs . The Court need no t 5 accept a taxpayer's self-serving testimony when the taxpayer 5 6 fails to present other probative evidence . Beam v . Commissioner , T .C . Memo . 1990-304 (citing Tokarski v . Commissioner , 87 T .C . 74, 77 (1986)) . 9 We now consider Petitioner's charitable cas h 10 contributions and charitable non-cash contributions for 11 2006 . Charitable contributions a taxpayer makes ar e 12 generally deductible under Section 170(a) . No deduction is 13 allowed, however, for any contribution of $250 or mor e 14 unless the taxpayer substantiates the contribution by a 15 contemporaneous written acknowledgment of the contribution 16 by a qualified donee organization . Sec . 170(f)(8)(A) . We 17 note there are now more stringent requirements fo r 18 contributions of money for taxable years beginning afte r 19 August 17, 2006 . Sec . 170(f)(17) ; Pension Protection Act of 20 2006, Pub . L . 109-280, Sec . 1217, 120 Stat . 1080 . 21 Petitioner claimed he donated $3,824 of cash t o 22 churches in 2006 . He was able to substantiate that he gave 23 $2,494 to Calvary Baptist Church, but asserts that th e 24 remaining $1,330 of cash was given to various other churches 25 in 2006 . He does not specify which other churches he may Heritage Reporting Corporatio n (202) 628-4888 6 1 have contributed cash to in 2006 . 2 We may estimate cash contributions under the Cohan 3 rule for contributions made before August 17th, 2006 . See 4 Fontanilla v . Commissioner , T .C . Memo . 1999-156 . For the 5 Court to estimate the amount of an expense, however, we .must 6 have some basis upon which an estimate may be made . Vanice k v . Commissioner , 85 T .C . 731, 743 (1985) . Without such a basis, any allowance would amount to unguided largesse . 9 Williams v . United States , 245 F .2d 559, 560 (5th Cir . 10 1957) . We conclude that the $1,330 amount Petitioner 11 claimed he donated to other churches for the year i s 12 excessive, given that it is over half the amount he gave to 13 his regular church for the entire year, and for which he was 14 able to substantiate . Instead, we find $300 is a more 15 reasonable amount that Petitioner may have given in 2006 to 16 other churches before August 17th, 2006 . 17 We next turn to Petitioner's contributions of 18 property . Petitioner claimed he contributed $24,300 of 19 property to various charities during 2006 . The deduction 20 for a contribution of property equals the fair market value 21 of the property on the date contributed . Sec . 1 .170A- 22 1(c)(1), Income Tax Regs . A taxpayer claiming .a charitable 23 contribution is generally required to maintain for eac h 24 contribution a canceled check, a receipt from the donee 25 charitable organization showing the name of the Heritage Reporting Corporatio n (202) 628-4888 7 1 organization, and the date and amount of the contribution, 2 or other reliable written records showing the name of the 3 donee and the date and amount of the contribution . Sec . 4 1 .170A-13(a)(1), Income Tax Regs . 5 Additional . rules apply for contributions o f 6 property exceeding $5,000 . Sec . 1 .170A-13(c)(2), Income Tax 7 Regs ; Sec . 1 .170A-13(c)(1)(I), Income Tax Regs . We need no t discuss these additional requirements . Petitioner failed t o 9 comply with any requirements . 10 The only evidence Petitioner provided regardin g 11 property contributions were receipts from AMVETS and Th e 12 Baras Foundation . Each organization provides receipts, but 13 leaves it to the donor to complete the items donated and the 14 value of the donations . Petitioner did not provide any 15 itemization of the property he contributed in 2006, nor did 16 he provide any evidence that shows the price he paid when he 17 acquired the property, the date he acquired the property, or 18 how he . determined the fair market value of the property at 19 the time of contribution . We are left to speculate wha t 20 property Petitioner may have donated . This we refuse to do . 21 We therefore sustain Respondent's disallowance o f 22 Petitioner's claimed charitable contributions of property 23 for 2006 . 24 We next address whether Petitioner ha s 25 substantiated the theft loss Petitioner claimed for 2006 . Heritage Reporting Corporatio n (202) 628-4888 8 Simply put, Petitioner has failed to substantiate that a theft loss occurred during 2006, and what property, if any, was stolen . To reflect the foregoing, decision will be entered for Respondent, except with respect to the $2,494 charitable cash contribution Petitioner was able to substantiate . This concludes the Court's oral findings of fact and opinion in . this case . (Whereupon, at 10 :11 p .m ., the bench opinion in th e 10 above-entitled case was concluded .) 1 1 12 1 3 14 15 16 17 1 8 1 9 20 21 22 23 24 25 Heritage Reporting Corporation (202) 628-4888