                  T.C. Summary Opinion 2004-119



                     UNITED STATES TAX COURT



                    LYNDA WANG, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 3904-03S.              Filed September 1, 2004.


     Lynda Wang, pro se.

     Kevin M. Murphy and Anne D. Melzer, for respondent.



     PAJAK, Special Trial Judge:    This case was heard pursuant to

the provisions of section 7463 of the Internal Revenue Code in

effect at the time the petition was filed.   Unless otherwise

indicated, section references are to the Internal Revenue Code in

effect for the year in issue, and all Rule references are to the

Tax Court Rules of Practice and Procedure.   The decision to be

entered is not reviewable by any other court, and this opinion

should not be cited as authority.
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     Respondent determined a deficiency of $949 in petitioner’s

2000 Federal income tax.

     The issue for decision is whether petitioner is entitled to

deduct for 2000 an alleged theft loss of $80,950 from 1980.

     Petitioner resided in Rochester, New York, at the time she

filed her petition.

     Petitioner refused to sign a stipulation of facts.

     Petitioner filed Form 1040, U.S. Individual Income Tax

Return, for taxable year 2000.    On her return, petitioner claimed

$80,950 under “other miscellaneous deductions”.    Respondent

determined that petitioner was not entitled to the claimed

deduction.

     In her petition, petitioner contended that she is entitled

to carry forward losses for 20 years.    In her memorandum,

petitioner stated that her claimed deduction of $80,950 was due

to a theft loss from 1980.    Petitioner further stated that in

1980 her landlord, Bobson Realty, through various agents, first

stored her belongings for months and subsequently threw them

away.

     We first address whether petitioner is entitled to a theft

loss deduction.   Section 165(a) allows a deduction for any loss

sustained during the taxable year and not compensated for by

insurance or otherwise.    Section 165(c)(3), in relevant part,

limits such a deduction for individuals to losses of property not
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connected with a trade or business, if such losses arise from

theft.    Section 165(e) provides that theft losses are treated as

sustained during the taxable year in which the taxpayer discovers

the loss.   The amount of a theft loss the taxpayer may deduct, as

limited by section 165(h), is the lesser of the adjusted basis of

the property or its fair market value.   Sec. 1.165-8(c), Income

Tax Regs.

      Deductions are strictly a matter of legislative grace.

INDOPCO, Inc. v. Commissioner, 503 U.S. 79, 84 (1992); New

Colonial Ice Co. v. Helvering, 292 U.S. 435, 440 (1934).

Taxpayers must substantiate any deductions claimed.    Hradesky v.

Commissioner, 65 T.C. 87, 89 (1975), affd. per curiam 540 F.2d

821 (5th Cir. 1976).   Because petitioner did not meet the

substantiation and recordkeeping requirements of section

7491(a)(2), the burden of proof remains on petitioner.   Rule

142(a).

      In her memorandum, petitioner described her 1980 belongings

as:

      1. Clothes - 2 evening dresses at $100/ea.       $400
         business suits at $80/ea. & others
      2. Books - 3-4 yrs. graduate study, books      70,000
         with notations, reports, etc. papers for
         career and CPA exam - 4 yrs. time & efforts
      3. Stamp collection, scholastic records (GRE      500
         Tofel, Diplomas), Receipts old coins, etc.
      4. Other household items                           50
      5. Pictures of past memories, souvenirs        10,000
                                              Total $80,950.00

She further described her belongings in part to be “4 years
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Graduate School books, research papers & reports & notes, which

are for my career & business”.     At trial, petitioner claimed that

her 1980 belongings included “my ancient collections of ancient

coins and stamps and the picture that I took all over the United

States, thousands.   What else?    Also my family memories.   That’s

most important.   Once it’s missing, I couldn’t replace them.”

Unfortunately, memories are delectable, but memories are not

deductible.   Loss of sentimental value is not a deductible loss.

Ganas v. Commissioner, T.C. Memo. 1990-143, affd. without

published opinion 943 F.2d 1317 (11th Cir. 1991).

     Petitioner did not prove the value of her 1980 belongings.

Petitioner did not prove the theft of these belongings.       She did

not have a police report.    She claimed she brought a legal action

against her landlord but failed to prove that fact or any result

from any legal action.

     Other than bare assertions, petitioner presented no evidence

that she sustained a theft loss in 1980.     At trial, petitioner’s

statements regarding the alleged theft were inconsistent.

Petitioner presented no evidence to substantiate her entitlement

to the alleged 1980 theft loss, which she claimed as a deduction

for taxable year 2000.

     On this record, we conclude that petitioner is not entitled

to a theft loss deduction.   Because we so conclude, we need not

reach the issue of whether petitioner was entitled to a
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carryforward deduction.   Accordingly, we sustain respondent’s

determination.

     Contentions we have not addressed are irrelevant, moot, or

without merit.

     Reviewed and adopted as the report of the Small Tax Case

Division.



                                         Decision will be entered

                                    for respondent.
