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proving that it is erroneous. Rule 142(a); Welch v. Helvering,
290 U.S. 111, 115 (1933). Because of this presumption of
correctness, courts will generally 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).
The Court of Appeals for the Fifth Circuit, to which appeal of
this case would lie, has noted, however, that "a court need not
give effect to the presumption of correctness in a case involving
unreported income if the Commissioner cannot present some
predicate evidence supporting its determination." Portillo v.
Commissioner, 932 F.2d 1128, 1133 (5th Cir. 1991), affg. in part
and revg. and remanding in part T.C. Memo. 1990-68. If the
presumption of correctness does not apply, the Commissioner's
determination will be deemed arbitrary, and consequently, she
will bear the burden of proving the correct amount of any taxes
owed. Sealy Power, Ltd. v. Commissioner, 46 F.3d 382, 386 (5th
Cir. 1995), affg. in part and revg. and remanding in part T.C.
Memo. 1992-168.
In her notice of deficiency, respondent determined that
petitioner had embezzlement income. Based on her CPI
calculations, she also determined that petitioner had unreported
self-employment income from his tax consulting practice and other
businesses. We now address the validity of these determinations.
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