- 21 -21
conduct intended to conceal, mislead, or otherwise prevent the
collection of such taxes. Rowlee v. Commissioner, 80 T.C. 1111,
1123 (1983). Fraud can never be presumed. Beaver v. Commissioner,
55 T.C. 85, 92 (1970). Fraud may be proven by circumstantial
evidence, Stone v. Commissioner, 56 T.C. 213, 223-224 (1971), and
the Court may consider the taxpayer's entire course of conduct,
Rowlee v. Commissioner, supra at 1123.
To prove fraud, respondent relies primarily on petitioners'
failure to report the income from the grocery/convenience store
business, as well as the check-kiting scheme, on their original
delinquent returns or on amended returns. Respondent asserts that:
(1) Petitioner did not file the delinquent returns with Revenue
Officer Scilipoti in order to hide the fact that no income was
reported from the grocery/convenience store business; (2)
petitioner had sufficient records from his calendar of daily gross
receipts and boxes of bills to calculate his net income from the
grocery/convenience store business; (3) petitioner knew from his
lifestyle that he had earned substantial profits from his
grocery/convenience store business; and (4) petitioner knew he had
income from his check-kiting scheme.
Respondent's assertions are not supported by the evidence.
First, we find credible petitioner's belief that he had no profits
from the grocery/convenience store business and that his lack of
adequate books and records prevented him from establishing
Page: Previous 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 NextLast modified: May 25, 2011