Ronald E. Reed - Page 6

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          858 (2d Cir. 1985), affg. in part and remanding Mandina v.                  
          Commissioner, T.C. Memo. 1982-34.  Petitioner, however, argues              
          that “there isn't any evidence at all that Respondent can furnish           
          to prove that Petitioner made a single dollar from drug                     
          proceeds”, notwithstanding respondent's reliance on the plea                
          agreement and the statement of facts.1  Since this case involves            
          illegal unreported income, petitioner's assertion suggests that             
          Llorente v. Commissioner, 649 F.2d 152 (2d Cir. 1981), affg. in             
          part, revg. in part and remanding 74 T.C. 260 (1980),2 applies              
          and requires respondent to satisfy the burden of coming forward             
          with evidence linking petitioner to an income-producing activity.           
          In the stipulation of facts, however, petitioner concedes that he           
          spent the amounts specified for the listed property.                        
          Petitioner's concession necessarily acknowledges receipt of funds           
          to purchase the listed property and eliminates any threshold                
          requirement imposed by Llorente.  See Tokarski v. Commissioner,             


          1    Petitioner also argues that he was assured that the plea               
          agreement and the statement of facts would not be used against              
          him in any other proceeding.  This Court determined petitioner's            
          argument to be without merit and denied his motion to dismiss for           
          lack of jurisdiction on Apr. 15, 1993.  We see no need to                   
          reconsider that decision.                                                   
          2    In accordance with the doctrine of Golsen v. Commissioner,             
          54 T.C. 742 (1970), affd. 445 F.2d 985 (10th Cir. 1971), we would           
          defer to Llorente v. Commissioner, 649 F.2d 152 (2d Cir. 1981),             
          affg. in part, revg. in part and remanding 74 T.C. 260 (1980), if           
          that case were applicable and this case were appealable to the              
          Court of Appeals for the Second Circuit.                                    




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