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that petitioner had caused to be deposited in Interservice's
account. The Interservice check to petitioner's wife as a
purported loan payment, standing alone, is insufficient without
supporting documentation or a credible explanation as to why
petitioner's wife would make loans in excess of half a million
dollars to Interservice, particularly when Interservice did not
build any homes. Petitioner has failed to give a credible
explanation of why deposits that are purportedly loans from his
wife would have come from Cable Leon or his daughter. Esquivel's
testimony that she traveled to Mexico just to compare numbers is
not credible.
The evidence is clear and convincing that the stipulated
amounts received by petitioner and amounts petitioner received as
deposits to Interservice constituted income and not loans. Thus,
respondent has proven an understatement of income. Even in
criminal cases, where the Government bears the burden of proof
beyond a reasonable doubt, proof of unreported income is
sufficient to establish an underpayment of tax absent proof by
the taxpayer of offsetting expenses. See, e.g., United States v.
Hiett, 581 F.2d 1199, 1202 (5th Cir. 1978); Elwert v. United
States, 231 F.2d 928, 933-936 (9th Cir. 1956); United States v.
Bender, 218 F.2d 869, 871 (7th Cir. 1955). A fortiori, that
proof is sufficient in this civil case.
Respondent has established a likely source of income,
petitioner's business interests in Mexico. Respondent
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