Adnan Al Kaissy - Page 16

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            portion of an underpayment of tax by a taxpayer which is                                   
            specifically attributable to fraud.                                                        
                  The burden is on respondent to establish fraud by clear and                          
            convincing evidence.  Sec. 7454(a); Rule 142(b).  Whether a                                
            portion of the tax is due to fraud is a question of fact to be                             
            determined from consideration of the entire record before the                              
            Court.  Gajewski v. Commissioner, 67 T.C. 181, 199 (1976), affd.                           
            without published opinion 578 F.2d 1383 (8th Cir. 1978).  Seldom                           
            is the Commissioner able to produce direct evidence of a                                   
            taxpayer's fraud, since fraud by its very nature is a question of                          
            a taxpayer's intent.  However, the Commissioner may prove                                  
            fraudulent intent through circumstantial evidence.  A taxpayer's                           
            entire course of conduct may be considered in determining whether                          
            fraudulent intent exists.  Rowlee v. Commissioner, 80 T.C. 1111,                           
            1123 (1983).  The often-cited case of Bradford v. Commissioner,                            
            796 F.2d 303, 307 (9th Cir. 1986), affg. T.C. Memo. 1984-601,                              
            lists as some of the "badges of fraud":  (1) Understatement of                             
            income; (2) inadequate records; (3) failure to file tax returns;                           
            (4) implausible or inconsistent explanations of behavior; (5)                              
            concealing assets; and (6) failure to cooperate with tax                                   
            authorities.  Although the factors listed in the Bradford case                             
            are always considered, the record as a whole must be reviewed by                           
            the Court in determining whether the Commissioner has shown fraud                          
            by clear and convincing evidence.  The only item listed in the                             





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