Taxpayer cannot claim a deduction under A.R.S. § 43-1029 (restoration of amount held under claim of right) for wages he received but not repaid. Federal reserve notes are not non-taxable obligations of the United States under 31 U.S.C. § 3124.

Taxpayers did not establish they were real estate professionals entitled to an exception to the passive activity loss rule under I.R.C. § 469(c)(7).

A Taxpayer who has to repay in a later year amounts he had received and held under a claim of right that was reportable in previous years may deduct the repayment in the year in which it is made and cannot reduce a proposed assessment for 2009 for repayments made in 2011 and 2012, citing Income Tax Procedure (ITP) 95 1.

Arizona subtraction for compensation received for active service as a member of the armed forces of the United States did not apply to compensation from the United States Public Health Service because the Health Service does not fall within the definition of the armed forces.

The definition of Arizona gross income for tax year 2009 did not allow the federal exclusion for $2,400 in unemployment compensation because the definition of Internal Revenue Code in the Arizona statutes never included that portion of the federal American Recovery and Reinvestment Act of 2009.

Taxpayers could not deduct as Schedule C business expenses amounts they paid for their adult children’s racing activity

Arizona income tax law did not conform to the federal provision that excluded up to $2,400 of unemployment compensation from federal gross income for tax year 2009. The definition of Arizona gross income for tax year 2009 did not allow the federal exclusion for unemployment compensation. The fact Taxpayers were not aware of the non-conformance is not a basis to abate an otherwise proper assessment.

Taxpayer cannot claim a deduction for a federal credit for mortgage interest if they claimed a mortgage interest deduction rather than a credit on their federal tax return.

Taxpayer is entitled to interest abatement for 45 month period during which the protest was not worked because an auditor was not assigned to the matter. There are no grounds to abate remaining interest or tax.

Taxpayer is not entitled to a refund of taxes withheld by his employer because Taxpayer did not file a return within four years after the due date of the original return.