- 16 - petitioner created or participated in numerous entities, bank accounts, transactions among purported partners and shareholders, and other purported arrangements (such as loans, leases, flow- throughs), many of which were fictitious, creating layers of complexity which appear to have served little or no function other than an attempt to deceive respondent. Indeed, the web woven by petitioner is so tangled as to be virtually impenetrable. Additions for Fraud Respondent determined in the notice of deficiency that petitioner is liable for the additions to tax for fraud under section 6653(b)(1)(A) and (B) for 1987 and section 6653(b) for 1988. Respondent bears the burden of proof and must establish each element of fraud by clear and convincing evidence. Sec. 7454(a); Rule 142(b); Akland v. Commissioner, 767 F.2d 618, 621 (9th Cir. 1985), affg. T.C. Memo. 1983-249; Toussaint v. Commissioner, 743 F.2d 309, 312 (5th Cir. 1984), affg. T.C. Memo. 1984-25; Wright v. Commissioner, 84 T.C. 636, 639 (1985). Respondent must prove fraud in each of the years involved. Drieborg v. Commissioner, 225 F.2d 216, 220 (6th Cir. 1955), affg. in part and revg. in part a Memorandum Opinion of this Court dated Feb. 24, 1954. Respondent must prove by clear and convincing evidence that: (1) An underpayment of tax exists for each of the years in issue, and (2) that some part of the underpayment is due to fraud. Sec.Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Next
Last modified: May 25, 2011