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Jiordano's or his delivery of summonses, nor explained how he may
have met his cost of living. Because petitioner has not offered
a credible explanation of how he met his living expenses in 1992,
he has failed to demonstrate error in respondent's determination
that he had unreported income of $34,752 based on his cost of
living, and we therefore sustain the determination.
1993
The parties have stipulated that petitioner received
nonemployee compensation from Cantel Communications in the amount
of $18,018.98 in 1993. Respondent also determined that
petitioner received "unreported income" of $35,873 in that year.
As previously discussed, because respondent presented no evidence
that petitioner was engaged in any other income-producing
activity besides working for Cantel Communications, the notice of
deficiency is arbitrary and is not entitled to a presumption of
correctness insofar as it determines such unreported income. In
light of the fact that (i) petitioner admits receiving $18,018.98
of income, which could have met his cost of living; (ii)
petitioner denies receiving any other income; (iii) respondent's
determination of unreported income is not presumptively correct;
and (iv) there is no other evidence of unreported income, we will
not sustain respondent's determination of unreported income of
$35,873 in 1993.
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