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underreported his income, one of the required elements of the
fraud addition to tax is not present.
In particular for 1984 and 1985, because respondent has
failed to prove fraud, the assessment of any tax deficiency and
additions to tax for those years is barred by the statute of
limitations.3 Sec. 6501(a), (c)(1).
Unreported Income for 1987
For 1987, in spite of our conclusion that fraud has not been
established, respondent’s assessment of a tax deficiency would
not be barred by the 3-year period of limitation under section
6501(a), and we must decide whether petitioner should be charged
with $200,000 in unreported income relating to the managed
account funds deposited into the bank accounts in his name.4 On
this issue for this year, petitioner has the burden of proof by a
preponderance of the evidence. Rule 142(a).
3 We note that respondent has not raised the 6-year period of
limitations under sec. 6501(e)(1)(A) for 1984 and 1985. Because
respondent failed to raise the 6-year period of limitations in
pleading, amended pleading, or briefs, we shall not consider its
application. See Estate of Rosenberg v. Commissioner, 86 T.C.
980, 984 n.1 (1986), affd. without published opinion per curiam
812 F.2d 1401 (4th Cir. 1987); Markwardt v. Commissioner, 64 T.C.
989, 997-998 (1975).
4 Respondent determined that $244,449 in managed account
funds was deposited into bank accounts in petitioner’s name. On
the evidence, we have found that the correct amount of managed
account funds deposited into bank accounts in petitioner’s name
was $200,000.
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