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Respondent asserts that the deposits into the Maple Press,
Acacia Press, and Print Technology bank accounts constituted
unreported income to petitioners in the amounts of $449,306,
$401,205, and $332,138 for their 1986, 1987, and 1988 taxable
years, respectively.2 Petitioners argue that a majority of the
deposits were interaccount transfers or loans, rather than
income. We find that the evidence supports respondent.3
Section 61(a) defines gross income as "all income from
whatever source derived." Sec. 61(a)(1). This definition
includes all "accessions to wealth, clearly realized, and over
which the taxpayers have complete dominion." Commissioner v.
Glenshaw Glass Co., 348 U.S. 426, 431 (1955); Hawkins v. United
States, 30 F.3d 1077, 1079 (9th Cir. 1994). When a taxpayer
keeps no books or records for his or her business, the
Commissioner generally may recompute his or her income under any
method that the Commissioner determines clearly reflects income.
Sec. 446(b); Commissioner v. Hansen, 360 U.S. 446, 467 (1959);
Cole v. Commissioner, 586 F.2d 747, 749 (9th Cir. 1978), affg.
2 Respondent asserted in her opening brief that petitioners
failed to report gross receipts totaling $333,714 for 1988, but
respondent made a mathematical error in that computation. This
$1,567 discrepancy does not affect our holding.
3 Petitioners argue that respondent has the burden of proof
with respect to any income earned by Acacia Press for 1986 and
1987 because Acacia Press was not specifically mentioned in the
notice of deficiency and is a new matter. We are persuaded that
the gross receipts in question must be included in petitioners'
income for 1986 and 1987 regardless of which party has the burden
of proof.
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