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evidence of fraudulent intent. Beaver v. Commissioner, 55 T.C.
85 (1970). Fraud may be proved by circumstantial evidence and
inferences drawn from the record because direct proof of the
taxpayer's intent is rarely available. Spies v. United States,
317 U.S. 492 (1943); Rowlee v. Commissioner, 80 T.C. 1111 (1983);
Stephenson v. Commissioner, 79 T.C. 995 (1982), affd. 748 F.2d
331 (6th Cir. 1984).
Fraud is defined as an intentional wrongdoing designed to
evade tax believed to be owing, effectuated by conduct designed
to conceal, mislead, or otherwise prevent the collection of such
tax. Webb v. Commissioner, 394 F.2d 366, 377 (5th Cir. 1968),
affg. T.C. Memo. 1966-81; Mitchell v. Commissioner, 118 F.2d 308,
310 (5th Cir. 1941), revg. 40 B.T.A. 424 (1939); Estate of
Pittard v. Commissioner, 69 T.C. 391 (1977); McGee v.
Commissioner, 61 T.C. 249, 256 (1973), affd. 519 F.2d 1121 (5th
Cir. 1975).
Fraudulent intent may be inferred from a pattern of conduct.
Spies v. United States, supra at 499. A pattern of consistent
underreporting of income, especially when accompanied by other
circumstances showing an intent to conceal, justifies the
inference of fraud. See Holland v. United States, 348 U.S. 121,
137 (1954); Otsuki v. Commissioner, 53 T.C. 96 (1969). Fraud may
also be inferred where the taxpayer makes false and inconsistent
statements to revenue agents, Grosshandler v. Commissioner, 75
T.C. 1, 20 (1980), or files false documents. Stephenson v.
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