- 34 -
we did not find him credible. In addition, we found that Mr.
Katerelos had a selective memory and that he was evasive when
answering questions posed by counsel for respondent. Under such
circumstances, we are not required to, and generally do not, rely
on the testimony of Mr. Katerelos. Geiger v. Commissioner, 440
F.2d 688, 689-690 (9th Cir. 1971), affg. per curiam T.C. Memo.
1969-159; Wood v. Commissioner, 338 F.2d 602, 605 (9th Cir.
1964), affg. 41 T.C. 593 (1964); Tokarski v. Commissioner, 87
T.C. 74, 77 (1986); Hradesky v. Commissioner, 65 T.C. 87, 90
(1975), affd. per curiam 540 F.2d 821 (5th Cir. 1976).
Issues As to Which Respondent Has the Burden of Proof
Additions to Tax and Penalties for Fraud
Respondent determined that Mr. Katerelos is liable for 1987
and 1988 for the additions to tax under section 6653(b)(1) and
for 1989 and 1990 for the penalties under section 6663(a) on the
portion of the underpayment attributable to the underreporting of
certain gross receipts of NDV.28 Respondent concedes that Ms.
Katerelos is not liable for any of the years 1987 through 1990
for any additions to tax or penalties for fraud.29
28 Respondent determined in the notice that $18,151, $10,918,
and $21,997 of the total underpayment for each of the years 1988
through 1990, respectively, was due to fraud. Respondent did not
determine that petitioners are liable for the additions to tax
and penalties for fraud on that portion of the underpayment for
each of those years that was not attributable to the under-
reporting of certain gross receipts of NDV.
29 Petitioners argue that, because fraud cannot be imputed from
one spouse to another and because respondent concedes that Ms.
(continued...)
Page: Previous 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 NextLast modified: May 25, 2011