- 9 - evaluating petitioner's fraudulent intent under section 6651(f), we consider the same elements as are relevant for section 6663 and former section 6653(b). See Clayton v. Commissioner, 102 T.C. 632, 652-653 (1994). Over the years, courts have developed a number of objective factors, or "badges", that tend to establish fraud. Recklitis v. Commissioner, 91 T.C. 874, 910 (1988). These badges include: (1) A pattern of understatement of income, (2) inadequate books and records, (3) failure to file tax returns, (4) concealment of assets, (5) failure to cooperate with tax authorities, (6) income from illegal activities, (7) implausible or inconsistent explana- tions of behavior, (8) an intent to mislead which may be inferred from a pattern of conduct, (9) lack of credibility of the tax- payer's testimony, and (10) dealings in cash. Laurins v. Commis- sioner, 889 F.2d 910, 913 (9th Cir. 1989), affg. Norman v. Com- missioner, T.C. Memo. 1987-265; Edelson v. Commissioner, 829 F.2d 828, 832 (9th Cir. 1987), affg. T.C. Memo. 1986-223; Petzoldt v. Commissioner, supra at 699; Rowlee v. Commissioner, 80 T.C. 1111, 1125 (1983). Though this list of the badges of fraud is nonex- clusive, it is illustrative. Miller v. Commissioner, 94 T.C. 316, 334 (1990). Respondent based the Motion for Summary Judgment on the facts set forth in respondent's requests for admission, which were deemed admitted. Matters deemed admitted pursuant to Rule 90 are conclusively established and may be sufficient to supportPage: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
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