Hugh Wilkinson and Evelyn Wilkinson - Page 16

                                        - 16 -                                         
          Commissioner, 763 F.2d 1139, 1146 (10th Cir. 1985), affg. T.C.               
          Memo. 1984-152.                                                              
               And finally, respondent argues that petitioners' failure to             
          cooperate with tax authorities is evidence of fraud.  We                     
          disagree.  Although there is some evidence that Dr. Wilkinson was            
          not fully accurate in responding to questions posed by                       
          respondent's agent, we do not find that these inaccuracies were              
          the product of an intent to conceal income from respondent or                
          otherwise evade income taxes.                                                
               We hold that respondent has failed to prove by clear and                
          convincing evidence that petitioners fraudulently failed to file             
          their 1988 and 1989 tax returns by intending to "conceal,                    
          mislead, or otherwise prevent the collection of the tax."  See               
          Stoltzfus v. United States, 398 F.2d at 1004; Webb v.                        
          Commissioner, 394 F.2d at 377.  We hold for petitioners on this              
          D.  Failure To File Timely Under Section 6651(a)                             
               Respondent asserts in the alternative that petitioners are              
          liable for the section 6651(a)(1) addition to tax for their                  
          failure to file timely 1988 and 1989 Federal income tax returns.             
          Pursuant to section 6651(a)(1), where a taxpayer fails to file a             
          tax return on the date prescribed for filing (including any                  
          extension of time for filing), there shall be added to the tax               
          required to be shown on the return an amount equal to 5 percent              
          of that tax for each month or fraction thereof that the failure              

Page:  Previous  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  Next

Last modified: May 25, 2011