- 8 -
beginning net worth figure is incorrect, because it does not
include $210,000 he accumulated over many years. Petitioner
contends that beginning at age 6 he simultaneously worked five or
six jobs (e.g., selling peas and greens, herding cattle, and
delivering firewood). He further contends that over the course
of 15 years he accumulated $210,000 performing these tasks and
stored these earnings in a bucket and later in a suitcase.
Petitioner testified, however, that prior to 1984 the $210,000
was deposited in bank accounts and used to purchase real estate.
These assets are accounted for in respondent's beginning net
worth figure. As a result, petitioner has effectively conceded
that respondent's beginning net worth figure is correct.
Accordingly, we conclude that respondent has established with
reasonable certainty petitioner's beginning net worth.
B. Source of Taxable Income and Reasonable Investigation
We must also determine whether respondent has established a
likely source of taxable income or has conducted a reasonable
investigation of leads negating possible sources of nontaxable
receipts. Holland v. United States, supra at 135-137; United
States v. Massei, supra. In 1986, petitioner was convicted of
gambling as a result of his participation in an illegal numbers
operation. Respondent contends that petitioner's gambling
constitutes a likely source of unreported income. Respondent,
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Next
Last modified: May 25, 2011