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with these deemed admissions, it follows that respondent is
entitled to summary judgment that petitioner is liable for the
deficiency in tax for 1992 as set forth in the notice of
deficiency.
Respondent also determined that petitioner is liable for the
penalty for fraud under section 6663(a) for 1992. Section
6663(a) provides that, if any part of the underpayment of tax
required to be shown on the return is due to fraud, there shall
be added to the tax an amount equal to 75 percent of the portion
of the underpayment that is attributable to fraud.
Fraud is defined as an intentional wrongdoing designed to
evade tax believed to be owing. Edelson v. Commissioner, 829
F.2d 829, 833 (9th Cir. 1987), affg. T.C. Memo. 1986-223;
Bradford v. Commissioner, 796 F.2d 303, 307 (9th Cir. 1986),
affg. T.C. Memo. 1984-601. Respondent has the burden to prove
fraud by clear and convincing evidence. Sec. 7454(a); Rule
142(b). Fraud is a question of fact to be resolved upon
consideration of the entire record and is never presumed. Estate
of Pittard v. Commissioner, 69 T.C. 391, 400 (1977).
Respondent's burden of proving fraud can be met by facts deemed
admitted pursuant to Rule 37(c). Doncaster v. Commissioner, 77
T.C. at 337; see Marshall v. Commissioner, 85 T.C. 267, 272-273
(1985).
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