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investigation and the loss resulting from the taxpayer's fraud.
Helvering v. Mitchell, 303 U.S. 391, 401 (1938).
Respondent bears the burden of proving fraud by clear and
convincing evidence. Sec. 7454(a); Rule 142(b). Respondent's
burden is met if it is shown that petitioner intended to evade
taxes known to be due and owing by conduct intended to conceal,
mislead, or otherwise prevent the collection of taxes, and that
there is an underpayment of tax. Stoltzfus v. United States, 398
F.2d 1002, 1004 (3d Cir. 1968); Rowlee v. Commissioner, 80 T.C.
1111, 1123 (1983); Acker v. Commissioner, 26 T.C. 107, 112
(1956).
The existence of fraud is a question of fact to be resolved
upon consideration of the entire record. DiLeo v. Commissioner,
96 T.C. 858, 874 (1991), affd. 959 F.2d 16 (2d Cir. 1992). Fraud
is never presumed but, rather, must be established by affirmative
evidence. Edelson v. Commissioner, 829 F.2d 828 (9th Cir. 1987),
affg. T.C. Memo. 1986-223. Direct evidence of the requisite
fraudulent intent is seldom available, but fraud may be proved by
circumstantial evidence. Spies v. United States, 317 U.S. 492,
499 (1943); Rowlee v. Commissioner, supra at 1123. The
taxpayer's entire course of conduct may establish the requisite
intent. Otsuki v. Commissioner, 53 T.C. 96, 105-106 (1969).
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