The petitioners, a married couple, had numerous tax issues at stake in this case. The husband co-owned a house with his wife's sister in a resort area in Idaho that they rented out as a short-term vacation rental. The petitioners were also invested in a real estate development project in another Idaho location for which they promised to pay $400,000 in the event that the development project failed and the primary obligor on the project's debt failed to pay. The project did fail and the petitioner's paid the bulk of the promised $400,000 but had $102,000 forgiven. The court disallowed some expenses associated with the petitioner/husband's dental practice due to lack of substantiation, but did uphold the vast majority of expenses associated with the rental property. On the forgiveness issue, the petitioners argued that they did not have $102,000 of cancelled debt income because they were merely guarantors. The Tax Court noted that it had previously held that a guarantor does not realize cancelled debt income upon the release of a contingent liability - see, Landreth v. Comr., 50 T.C. 803 (1968) and Hunt v. Comr., T.C. Memo. 1990-248, but the IRS argued that those cases were distinguishable because the guaranties in those cases were contingent while the petitioners' guaranty was unconditional and not contingent by its terms. However, the court noted that the guaranty was an unconditional promise to pay if the primary obligor failed to pay which made the guaranty contingent. As a result, the petitioners did not have cancelled debt income. Mylander v. Comr., T.C. Memo. 2014-191.