Michael J. Fitzpatrick - Page 14

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          years 1981 and 1982.  Consequently petitioner is liable for the             
          addition to tax under section 6653(b) for 1981, and he is liable            
          for the addition to tax under section 6653(b)(1) for 1982.  The             
          only remaining issue that we must decide is the amount of the               
          understatement of tax in 1982 which is attributable to fraud for            
          purposes of section 6653(b)(2).  We recognize that respondent has           
          the burden of proving fraud by clear and convincing evidence                
          whereas petitioner, as explained above, has the burden of showing           
          that he did not receive unreported income to overcome                       
          respondent's determination of deficiencies.  We find that                   
          respondent has met her burden.  The evidence clearly and                    
          convincingly shows that petitioner had dominion and control over            
          the R&S and Pares Y Nones, S.A. accounts, that the amounts                  
          deposited in those accounts by Landing constituted unreported               
          income to him, and that he received additional unreported income            
          as a result of the repairs on his home which Landing paid for.              
          The unreported income consisted of the bank deposit proceeds and            
          the renovations on petitioner's house.  Consequently, the entire            
          amount of petitioner's unreported income for 1982 is attributable           
          to fraud and is subject to the provisions of section 6653(b)(2).            

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