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After concessions,1 the following issues remain for decision:
(1) Whether respondent properly determined that petitioners had
cash on hand in the amount of $115,100 as of December 31, 1989, as
part of the 1989 net worth calculation; (2) whether petitioner
Shirley A. Zaban (Mrs. Zaban) qualifies for innocent spouse relief
pursuant to section 6013(e) for 1986 through 1990; (3) whether Mrs.
Zaban is liable for the fraud additions to tax for 1986 and 1987
pursuant to section 6653(b)(1)(A) and (B) and for 1988 pursuant to
section 6653(b)(1) and for the fraud penalty for 1989 pursuant to
section 6663; (4) whether Mrs. Zaban is liable for the additions to
tax for negligence or disregard of rules or regulations for 1986
and 1987 pursuant to section 6653(a)(1)(A) and (B) and for 1988
pursuant to section 6653(a)(1) and for the accuracy-related penalty
1 Petitioners concede the deficiencies relating to all of
the unreported income, except for $115,100 determined as cash on
hand as part of respondent's 1989 net worth calculation. They
also concede the fraud additions to tax and penalty for 1986
through 1989 with respect to Mr. Zaban. Moreover, petitioners
concede that they are not entitled to the $98,000 deduction for
forfeited funds for 1990. Finally, the parties have agreed that
petitioners are entitled to a $56,622 mortgage interest deduction
for 1990.
Respondent disallowed petitioners' 1987 and 1988 deductions
for certain miscellaneous expenses. Although petitioners
disputed this determination in their petition, they did not
address this issue either at trial or on brief. Because the
burden of proof lies with petitioners on this issue, we hold for
respondent. Rule 142(a). Additionally, and for the same
reasons, we hold for respondent on the innocent spouse issue
relating to the miscellaneous expense deductions. Respondent,
however, did not present any evidence on the fraud additions to
tax relating to the miscellaneous expense deductions, and given
our finding that no fraud existed with respect to other issues,
we hold for Mrs. Zaban on that issue. Rule 142(b).
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