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joint names of petitioner and his wife. The revenue agent served
a summons upon each of the banks to produce statements showing
deposit and withdrawal activity for each of petitioner's
accounts. On September 1, 1993, petitioner filed a petition to
quash respondent's summons of his bank records. The petition to
quash alleged that respondent committed fraud and
misrepresentation in obtaining the summons because the summons
itself was not issued by the Secretary. On February 4, 1994, the
U.S. District Court for the District of Columbia held that the
petition to quash was meritless and ordered summary enforcement
of the summons.
After obtaining the bank statements,3 respondent's revenue
agent determined the amount of income received by petitioner
based on the deposits to the various accounts. Included in the
bank deposits made by petitioner were payments he received as a
public insurance adjuster during the years at issue. Also
included in the bank deposits were two checks totaling $38,967,
which petitioner received on April 7, 1989, from the City of
Baltimore for professional services rendered to the city. To the
extent respondent's revenue agent could verify transfers between
petitioner's accounts, the revenue agent reduced the income
calculation by each amount which was transferred between accounts
3All the monthly bank statements were obtained by the
revenue agent except for the August 1987 statement. Respondent's
revenue agent estimated the amount of August deposits by using a
weighted average of all the deposits in that year.
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