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amount of income. Sec. 6501(e)(1)(A). Section 6501(e)(1)(A)
provides in part:
If the taxpayer omits from gross income an amount
properly includible therein which is in excess of 25
percent of the amount of gross income stated in the
return, the tax may be assessed, or a proceeding in
court for the collection of such tax may be begun
without assessment, at any time within 6 years after
the return was filed. * * *
Respondent bears the burden of proving that the 6-year limit
on the time to assess tax applies. Reis v. Commissioner, 1 T.C.
9, 13-14 (1942), affd. 142 F.2d 900 (6th Cir. 1944).
b. Six-Year Requirement
Less than 6 years after the due date for petitioner's 1976
and 1977 returns, petitioners signed Forms 872 to extend the time
to assess tax to December 31, 1986. Respondent issued the notice
of deficiency on December 23, 1986. Petitioners concede that
respondent issued the notice of deficiency in time to qualify
under section 6501(e)(1)(A) if more than 25 percent of gross
income was omitted from each return.
c. Twenty-Five Percent Omission From Gross Income
Respondent must prove that petitioners omitted more than 25
percent of gross income from their 1976 and 1977 returns. Sec.
6501(e)(1)(A); Romine v. Commissioner, 25 T.C. 859, 871 (1956).
Petitioners contend that respondent does not meet the 25
percent requirement. Petitioners contend that respondent may not
rely on the general presumption of correctness of a deficiency
notice to meet this burden, and that the mere existence of bank
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