James E. Stafford - Page 15

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          petitioner is deemed to have admitted that he received taxable              
          income from various sources, including wages and nonemployee                
          compensation, for all years at issue.  Petitioner is further                
          deemed to have admitted that he failed to file Federal income tax           
          returns reporting that income for any year.                                 
              On the basis of this record, we find that there is no                   
          genuine issue of material fact as to the deficiencies and                   
          additions to tax under section 6654 for failure to pay estimated            
          tax, and a decision may be rendered as a matter of law.                     
          Therefore, respondent's motion for summary judgment will be                 
          granted with respect to these issues.                                       
          2.  Fraud Additions to Tax                                                  
              In order to prevail on the proposed additions to tax for                
          fraud, respondent must prove by clear and convincing evidence               
          that an underpayment exists in the years at issue and that some             
          portion of the underpayment is due to fraud.  Sec. 7454(a); Rule            
          142(b); Petzoldt v. Commissioner, 92 T.C. 661, 699 (1989).  For             
          purposes of section 6653(b), an underpayment is the full amount             
          of the tax imposed where the taxpayer fails to file a return.               
          Sec. 6653(c)(1); Bagby v. Commissioner, 102 T.C. 596, 607 (1994);           
          sec. 301.6653-1(c)(1)(ii), Proced. & Admin. Regs.                           
              Respondent may meet her burden of proving liability for the             
          additions to tax for fraud by deemed admissions and facts deemed            
          stipulated.  Coninck v. Commissioner, 100 T.C. 495, 499 (1993);             
          Smith v. Commissioner, 91 T.C. 1049, 1052-1053 (1988), affd. 926            
          F.2d 1470 (6th Cir. 1991), and cases cited therein.    Petitioner           



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