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behavior concerning his calculation of tithing and in reporting
petitioners' income on the bank loan application was inconsistent
with the reporting of petitioners' income on the tax returns for
the years under consideration.
(4) Intent to Mislead
Misleading statements to an investigating agent may be
evidence of fraud. See Gajewski v. Commissioner, 67 T.C. 181, 200
(1976), affd. without published opinion 578 F.2d 1383 (8th Cir.
1978). Petitioner misled Ms. Bellamy when he provided her with
details of his income. During the audit, Ms. Bellamy indicated to
petitioner the importance of obtaining all relevant information so
that she could reconstruct petitioners' income. Petitioner refused
to permit Ms. Bellamy to review petitioners' 1983 Federal income
tax return.
Petitioner claims that petitioners provided Ms. Bellamy with
the brown books for the years under consideration at the first
audit meeting, and that she took the books with her and later
returned them. He further contends that his preparation of a
mileage log, completed during the audit and at Ms. Bellamy's
recommendation, is proof that the brown books were handed over to
her. But he later claimed that the brown books were destroyed by
his children, and expressed a belief that it was useless to keep
records for longer than 3 years. It took almost 2 years before Ms.
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