William Kale - Page 16

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               1. Underpayment                                                        
               The first element requires the Commissioner to establish the           
          existence of some underpayment of tax for each of the years in              
          issue.  Section 6653(c) defines underpayment as having in general           
          the same meaning as "deficiency;" i.e., to mean the amount by               
          which the tax imposed exceeds the amount of tax shown by the                
          taxpayer on his return.  Sec. 6211.  To prove an underpayment,              
          the Commissioner cannot satisfy her burden by relying solely on             
          the taxpayer's failure to prove error in the determination of the           
          deficiencies. Otsuki v. Commissioner, 53 T.C. 96, 106 (1969).               
               Respondent’s case rests heavily on the testimony of Toll and           
          Suval during the trial in this proceeding.  As petitioner states            
          in his brief:                                                               
               Mr. Toll claims to have paid * * * [petitioner] a                      
               $105,000 bribe to subvert the 1977 and 1978 audits; Mr.                
               Suval says he paid * * * [petitioner] $7,500 for having                
               introduced him to Mr. Toll. * * * If * * * [Toll and                   
               Suval’s] believed testimony is clear and convincing,                   
               then * * * [petitioner] owes taxes for the years at bar                
               * * *.                                                                 
          We have found the testimony of Toll, in particular, and Suval to            
          be trustworthy and convincing.  We acknowledge that Toll and                
          Suval pleaded guilty to various crimes in relation to the bribes.           
          We do not find that either of them had a motive that would prompt           
          false testimony in this case.  We acknowledge that, at times,               
          Toll’s testimony was not in complete accord with Suval's.                   
          However, the events of this case occurred over a decade ago.  We            






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