Court Opinion

ID: 4583011
Source: CourtListenerOpinion
Date Created: 2020-11-02 22:00:25.842018+00
Date Added: 2024-06-11T13:47:24.687728
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                        NOV 2 2020
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

RONALD GENE BERRY; LINDA                        No. 19-70684
KATHRYN BERRY,
                                                Tax Ct. No. 14090-15
                Petitioners-Appellants,

 v.                                             MEMORANDUM*

COMMISSIONER OF INTERNAL
REVENUE,

                Respondent-Appellee.

                           Appeal from a Decision of the
                             United States Tax Court

                           Submitted October 26, 2020**

Before:      McKEOWN, RAWLINSON, and FRIEDLAND, Circuit Judges.

      Ronald Gene Berry and Linda Kathryn Berry appeal pro se from the Tax

Court’s decision, following a bench trial, upholding the Commissioner of Internal

Revenue’s determination of deficiencies and accuracy-related penalties for the

2011 tax year. We have jurisdiction under 26 U.S.C. § 7482(a)(1). We review de

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
novo the Tax Court’s conclusions of law and for clear error its factual findings.

Meruelo v. Comm’r, 691 F.3d 1108, 1114 (9th Cir. 2012). We affirm.

      The Tax Court did not clearly err in determining that Phoenix Construction

and Remodeling, Inc. (“Phoenix”) did not overreport its gross income because the

Berrys failed to establish that the $60,000.00 cash deposit from petitioner Linda

Berry’s father to Phoenix was a loan. See 26 U.S.C. § 61(a) (defining gross

income); Welch v. Comm’r, 204 F.3d 1228, 1230-31 (9th Cir. 2000) (explaining

that the taxpayer must establish that income resulted from a nontaxable loan and

setting forth factors for determining whether a transaction is a loan). Contrary to

the Berrys’ contention, the Tax Court was not required to accept their proffered

documentary evidence of the alleged loan as true.

      The Tax Court did not clearly err in determining that the Berrys failed to

produce sufficient evidence to demonstrate that Phoenix was entitled to further

deductions for car and truck expenses and cost of goods sold as business expenses.

See 26 U.S.C. §§ 162(a) (business expenses), 274(d) (vehicle expenses); 26 C.F.R.

§ 1.61-3(a) (cost of goods sold to be deducted from gross income to determine

business income); Sparkman v. Comm’r, 509 F.3d 1149, 1159 (9th Cir. 2007)

(taxpayer bears burden of clearly showing right to claimed deduction).

      We do not consider arguments and allegations raised for the first time on

appeal. See Padgett v. Wright, 587 F.3d 983, 985 n.2 (9th Cir. 2009).

                                          2                                   19-70684
      We do not consider any contentions in the opening brief that are raised on

behalf of or by non-party Andrew Berry because they are outside the scope of this

appeal.

      AFFIRMED.

                                        3                                   19-70684