- 20 -20 for negligence or disregard of rules or regulations for 1989 against Mrs. Zaban. OPINION Issue 1. 1989 Net Worth Calculation The first issue for decision is whether respondent properly determined $115,100 as cash on hand as part of the 1989 net worth calculation. Petitioners assert that the cash belonged to Mr. Neumyer. The net worth method has been approved as a means of reconstructing the income of taxpayers who fail to report income and do not maintain adequate books and records. Holland v. United States, 348 U.S. 121 (1954); Lias v. Commissioner, 235 F.2d 879, 880 (4th Cir. 1956), affg. 24 T.C. 280 (1955); Estate of Beck v. Commissioner, 56 T.C. 297, 353-354 (1971). Deficiencies determined by indirect methods generally are presumed correct, Mills v. Commissioner, 399 F.2d 744, 749 (4th Cir. 1968), affg. T.C. Memo. 1967-67, and taxpayers bear the burden of proving that such deficiencies are erroneous, Rule 142(a); Parks v. Commissioner, 94 T.C. 654, 658-659 (1990). The net worth method requires a finding of both the beginning and ending net values of a taxpayer's assets. Holland v. United States, supra at 125. Mr. Zaban asserts that the contents of box 3567, in which the $115,100 cash was found, belonged to Mr. Neumyer. Mr. Zaban claims that Mr. Neumyer gave him between $155,000 and $175,000 in 1984 toPage: Previous 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Next
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