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* * * * * * *
To find out if you need to file a Federal return
this year, just fill out the enclosed worksheet and use
the chart. Keep the worksheet for your files.
There are some special situations when your filing
requirements change. These rules are explained on the
reminder notice enclosed with this letter. And of
course, if your income is more than the minimum shown
on the chart, you will have to file a tax return.
* * *
Based on this letter, petitioner concluded that she was not
required to file tax returns. Petitioner received a similar form
letter from the IRS in January 1996.
Discussion
Where a taxpayer has not filed a tax return, respondent may
reconstruct the taxpayer's unreported income. Holland v. United
States, 348 U.S. 121 (1954). The reconstruction of income need
only be reasonable in light of all surrounding facts and
circumstances. Giddio v. Commissioner, 54 T.C. 1530, 1533
(1970). Courts generally do not look behind the notice of
deficiency to examine the evidence upon which the determination
was made. Dellacroce v. Commissioner, 83 T.C. 269, 280 (1984).
In unreported income cases, however, the Court of Appeals for the
Ninth Circuit, to which this case is appealable, has required the
Commissioner to introduce some substantive evidence that
demonstrates that the taxpayer received unreported income.
United States v. Zolla, 724 F.2d 808 (9th Cir. 1984);
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Last modified: May 25, 2011