- 35 -
cited therein; see also Erickson v. Commissioner, 937 F.2d 1548,
1552-1553 (10th Cir. 1991), affg. T.C. Memo. 1989-552.
A. Schedule C Income--1982
Petitioner contends that he reported all income that was
known to him, and that any difference between expenses and
revenue came from loans or from disinvestment, e.g., sales of
assets. Petitioner also claims that on December 31, 1981, he had
a net worth of more than $1 million, and points out that by 1987
he was bankrupt.
Respondent contends that petitioner received and omitted
Schedule C income for 1982 in the amount of $185,512. See supra
table 4, for a comparison of respondent's determinations in the
notice of deficiency and respondent's position on brief.
We agree in part with respondent and in part with
petitioner.
(1) Background
When petitioner filled out his tax returns for the years in
issue (supra table 2), he did so by using his memory, estimating
figures, and looking at old check registers and assorted
receipts. Petitioner did not keep his records in an organized
manner. About 4 months after petitioner filed his 1982 tax
return, and just after he filed his 1986 tax return, in January
1988, some of petitioner's records were inadvertently shipped
away. In June 1989, petitioner brought three boxes of unsorted
records to Burns' office, but was told to take them back and sort
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