Kenneth Siebert - Page 11

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          that clearly reflects income.  Sec. 446(b); Meneguzzo v.                    
          Commissioner, 43 T.C. 824, 831 (1965).  Because petitioner failed           
          to produce any records, respondent used the CPI Rollover Method             
          to reconstruct petitioner's income for the years in issue.  Under           
          this method, income is computed by multiplying the adjusted gross           
          income reported on the taxpayer's most recently filed return by             
          the increase in the CPI, as published by the U.S. Department of             
          Labor, for the year in issue.  See Moore v. Commissioner, 722               
          F.2d 193, 196 (5th Cir. 1984), affg. T.C. Memo. 1983-20.  Based             
          on her CPI calculations, respondent determined that petitioner              
          had unreported self-employment income of $28,631, $29,470,                  
          $30,851, $32,256, and $33,021 for 1988, 1989, 1990, 1991, and               
          1992, respectively.                                                         
               Respondent has established that petitioner engaged in a tax            
          consulting practice during 1988 and 1989.  During these years,              
          Ms. Boals paid petitioner $150 per hour for his services.                   
          Petitioner rented office space from Hercules & Lavery and                   
          referred approximately a dozen of his clients to the firm during            
          this same period.  In 1988, Virginia Shaw paid petitioner a                 
          $5,000 retainer to prepare her 1987 Federal income tax return.              
          In addition, petitioner requested an extension of time to file              
          Ms. Shaw's return, because he was behind on audits and Tax Court            
          cases.  Moreover, petitioner testified that he was a tax                    
          consultant during 1988 and 1989, and he knew that he had to file            
          returns for these years.  Therefore, we conclude that respondent            

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