T.C. Memo. 2001-169
UNITED STATES TAX COURT
LARRY DEAN SYKES AND RUBY SYKES, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 3844-00. Filed July 6, 2001.
Respondent’s (R) agents seized $149,200 cash from
petitioners (Ps) during a search of Ps’ residence by
Federal and State law enforcement officers. R filed a
jeopardy assessment in that amount against petitioner
husband (P-H). P-H filed suit in U.S. District Court
to obtain judicial review of the jeopardy assessment.
The District Court subsequently sustained the
determination that P had taxable income of $48,473 in
1997 and found that P had savings of $100,727.
R determined that the $149,200 seized from Ps was
unreported taxable income for 1997. Ps contend that it
was not taxable income because P-H had a cash hoard in
that amount on Dec. 31, 1996.
Ps moved at trial to shift the burden of proving
the amount of the cash hoard to R under sec. 7491(a),
I.R.C. Ps offered evidence relating to the amount of
P’s cash hoard, but a substantial amount of that
evidence was not credible.
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