- 7 -
Commissioner, 100 F.3d 1308, 1317 (7th Cir. 1996), affg. T.C.
Memo. 1995-243; Gold Emporium, Inc. v. Commissioner, supra at
1378; Zuhone v. Commissioner, supra at 1325-1326; Ruth v. United
States, 823 F.2d 1091, 1094 (7th Cir. 1987).
In asking this Court to hold that the notice of deficiency
is arbitrary, petitioner is asking us to explore the
underpinnings of that notice. As a general rule, we will not
look behind the statutory notice to examine the evidence used in
making the determination. Petzoldt v. Commissioner, 92 T.C. 661,
688 (1989); Llorente v. Commissioner, 74 T.C. 260, 264 (1980),
affd. in part, revd. in part and remanded 649 F.2d 152 (2d Cir.
1981); Greenberg's Express, Inc. v. Commissioner, 62 T.C. 324,
327 (1974). Courts have identified an exception to the general
rule where the Commissioner, in a case involving unreported
income, introduces no direct evidence but rests on the
presumption of correctness and the taxpayer challenges the
3(...continued)
Malicki v. Commissioner, T.C. Memo. 1988-559; Zuhone v.
Commissioner, 883 F.2d 1317, 1325, 1326 (7th Cir. 1989) ("If the
taxpayer establishes that the Commissioner's determination is
arbitrary, courts generally shift the burden of production to the
Commissioner." (Citation omitted.) "If the taxpayer is
successful in showing that the assessment is arbitrary and
excessive or without factual foundation, the presumption drops
from the case."), affg. T.C. Memo. 1988-142; Ruth v. United
States, 823 F.2d 1091, 1094 (7th Cir. 1987) ("when the assessment
is shown to be 'without rational foundation' or 'arbitrary and
erroneous,' the presumption should not be recognized." (Citations
omitted.)).
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 Next
Last modified: May 25, 2011