Adnan Al Kaissy - Page 17

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            Bradford case as indicating fraud which is present in the instant                          
            case is the understatement of income.  Here, the understatement                            
            of income results from petitioner's taking an improper deduction.                          
            All petitioner's receipts of income were reported in his gross                             
            income on his returns for each of the years here in issue.                                 
            Respondent makes some arguments that certain items reported by                             
            petitioner were reported in an improper manner, but does not have                          
            any fraud contention based on underreporting of receipts by                                
            petitioner.  Respondent questions the type of the records                                  
            petitioner kept.  Petitioner's records were incorrect in that                              
            they had shown airline tickets purchased by MBWC as part of his                            
            expense, but otherwise were reasonably good records for an                                 
            individual to keep.  The controlling question here is whether                              
            respondent has shown by clear and convincing evidence that                                 
            petitioner claimed the deductions for air fares on his tax                                 
            returns knowing that he was not entitled to claim the deductions,                          
            and intending by claiming those deductions to evade a tax he knew                          
            to be owing.  From the evidence as a whole, we conclude that                               
            respondent has failed to show that petitioner was aware that he                            
            was not entitled to claim the air fare deductions, and has failed                          
            to show any intent by petitioner to evade tax by claiming these                            
                  Petitioner took all his records to a return preparer for                             
            preparation of his return.  This return preparer did not question                          

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