- 15 -
the collection of taxes. Stoltzfus v. United States, supra;
Marcus v. Commissioner, 70 T.C. 562, 577 (1978), affd. without
published opinion 621 F.2d 439 (5th Cir. 1980).
Fraud is never imputed or presumed, and courts should not
sustain findings of fraud upon circumstances that at most create
only suspicion. Olinger v. Commissioner, 234 F.2d 823, 824 (5th
Cir. 1956), affg. in part and revg. in part T.C. Memo. 1955-9;
Davis v. Commissioner, 184 F.2d 86, 87 (10th Cir. 1950); Green v.
Commissioner, 66 T.C. 538, 550 (1976). Mere suspicion does not
prove fraud, and the fact that the Court does not find the
taxpayer's testimony wholly credible is not sufficient to
establish fraud. Shaw v. Commissioner, 27 T.C. 561, 569-570
(1956), affd. 252 F.2d 681 (6th Cir. 1958); see also Cirillo v.
Commissioner, 314 F.2d 478, 482 (3d Cir. 1963), affg. in part and
revg. in part T.C. Memo. 1961-192.
Section 6663(a) provides generally that, if any part of any
underpayment of tax required to be shown on a 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. Under section 6663(b), if the Commissioner establishes
that any portion of an underpayment is attributable to fraud, the
entire underpayment shall be treated as attributable to fraud,
except with respect to any portion of the underpayment that the
taxpayer establishes (by a preponderance of the evidence) is not
attributable to fraud. Two elements must be satisfied before a
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011