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1990, and 1991. Respondent reconstructed petitioner's income
during the years in issue from figures that petitioner listed on
various loan applications and on purported copies of his Forms
1040 and Forms W-2 attached to one of these applications.
Respondent contends that the use of these figures is supported by
other evidence demonstrating petitioner's receipt of unreported
income from FCE and PCG. In his post-trial brief, petitioner
argues that respondent's determination is "not based on any fact
or evidence and is completely unfounded." We disagree.
Respondent's determinations are normally entitled to a
presumption of correctness. Rule 142(a); Welch v. Helvering, 290
U.S. 111 (1933). In order to deprive respondent's determination
of this presumption, petitioner must demonstrate that the
determination is arbitrary and unreasonable. Harbin v.
Commissioner, 40 T.C. 373, 376 (1963). Petitioner has failed to
so demonstrate. Respondent has provided sufficient evidence to
show that the determinations were neither arbitrary nor
unreasonable.
Here, respondent reconstructed petitioner's income using the
figures that petitioner himself listed on various loan
applications and on the purported copies of his tax returns and
Forms W-2 attached to one of these loan applications. This Court
has previously held that the use of income figures supplied by
the taxpayer himself "is an eminently reasonable and fitting
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