Charles E. Campbell - Page 16

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            taxable years 1987, 1988, and 1989, with the intent to evade the                             
            payment of taxes on such business transactions in each respective                            
            year.                                                                                        
                  36.  [Petitioner] failed to produce any records of [his]                               
            business or personal activities for respondent during the                                    
            examination of [his] income tax liabilities for the taxable years                            
            1987, 1988, and 1989.                                                                        
                  37.  [Petitioner's] failure to produce any records of [his]                            
            business or personal activities for respondent during the                                    
            examination of [petitioner's] income tax liabilities for the                                 
            taxable years 1987, 1988, and 1989 was fraudulent with the intent                            
            to evade the payment of taxes for each respective year.                                      
                  In support of a finding of fraud, courts have relied on a                              
            number of indicia of fraud in deciding section 6653(b) and                                   
            section 6651(f) cases.  Indicia of fraud include: (1) A pattern                              
            of understatement of income, (2) maintaining inadequate books and                            
            records, (3) failing to file tax returns, (4) giving implausible                             
            or inconsistent explanations of behavior, (5) concealing assets,                             
            (6) failing to cooperate with taxing authorities, (7) engaging in                            
            illegal activities, (8) attempting to conceal illegal activities,                            
            (9) dealing in cash, and (10) failing to make estimated tax                                  
            payments.  Recklitis v. Commissioner, 91 T.C. 874, 910 (1988).                               
            Although no single factor is necessarily dispositive on the issue                            
            of fraud, the existence of several indicia is persuasive                                     
            circumstantial evidence.  Petzoldt v. Commissioner, 92 T.C.                                  
            at 700.  Respondent argues that through the deemed admissions                                
            fraud is clearly and convincingly established by petitioner's                                
            conduct of dealing in cash, petitioner's failure to file tax                                 
            returns and report income earned, and petitioner's failure to                                




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