Malinowski v. Commissioner
United States Tax Court
Ps were members of a partnership which held stock in BAC. In 1972, such stock became worthless, and Ps claimed an ordinary loss on the basis that such stock qualified as "section 1244 stock." Some of BAC's records were transferred to the IRS and now cannot be located.
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Ps were members of a partnership which held stock in BAC. In 1972, such stock became worthless, and Ps claimed an ordinary loss on the basis that such stock qualified as "section 1244 stock." Some of BAC's records were transferred to the IRS and now cannot be located. Held: 1. The loss of records does not cause the burden of proof to shift to the Commissioner to show that the stock did not qualify as sec. 1244, I.R.C. 1954, stock; based on the secondary evidence presented by Ps, they have failed to prove that the stock did qualify as sec. 1244 stock. 2. Ps have failed to prove that, in the…
1Opinion of the Court
Simpson, Judge:
The Commissioner determined deficiencies in the petitioners’ Federal income taxes for 1972 as follows:
Petitioner Deficiency
Frank R. Malinowski and Mary Ann Malinowski . $1,978.08
Richard E. Sommers .:. 1,540.32
We must decide: (1) Whether, because of the loss of certain corporate records, the Commissioner had the burden of proving that stock did not qualify as “section 1244 stock” under section 1244 of the Internal Revenue Code of 1954;1 (2) whether a loss incurred on the worthlessness of certain stock is deductible as an ordinary loss, (A) because such stock qualified as section…
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