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Generally, respondent's determination in a statutory notice of
deficiency is entitled to a presumption of correctness. Welch v.
Helvering, 290 U.S. 111, 115 (1933).5 The fact that in the instant
case respondent's revised computation of income reduced the amount
of petitioner's unreported income for 3 of the 4 years in issue
does not affect the presumption of correctness attached to
respondent's original determination of petitioner's tax deficiency,
to the extent not reduced by respondent's revision. See Gobins v.
Commissioner, 18 T.C. 1159, 1168-1169 (1952), affd. per curiam 217
F.2d 952 (9th Cir. 1954).
Amounts received by a taxpayer while acting as an agent or
conduit are not required to be reported as income. Goodwin v.
Commissioner, 73 T.C. 215, 230 (1979); see also Liddy v.
Commissioner, T.C. Memo. 1985-107, affd. 808 F.2d 312 (4th Cir.
1986). As we stated in Diamond v. Commissioner, 56 T.C. 530, 541
(1971), affd. 492 F.2d 286 (7th Cir. 1974): "We accept as sound
law the rule that a taxpayer need not treat as income moneys which
he did not receive under a claim of right, which were not his to
keep, and which he was required to transmit to someone else as a
mere conduit."
We accept petitioner's assertion that he received moneys while
acting as an agent for Mr. Stennett and the Vanderhaydens. In this
5 Respondent has the burden of proof with regard to the
1990 increased deficiency asserted in the amended answer. Rule
142(a).
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