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the years in issue in repayment for the loan. That amount is not
taxable to the Takaos. Petitioners have not proved through
testimony or other evidence that they received any cash from her
mother above the $3,600 which we have allowed. Petitioners
further have not proved that the Takaos brought into the United
States from Japan any money other than money received for the
repayment of the loan. Accordingly, the understatement of income
is reduced $3,600 for each of the years in issue for loan
repayments received from Akiko's mother.
Cash Hoard
Under the cash deposits method of determining unreported
income, it is important to establish the amount of cash on hand
at the beginning of the years in issue, because a large amount of
undeposited cash could provide a likely source for the
unexplained bank deposits. United States v. Soulard, 730 F.2d at
1298. Petitioners have the burden to establish the amount of any
cash hoard accumulated before the beginning of the years in issue
as well as the amount from that cash hoard that Akiko deposited
during the years in issue. See Calhoun v. United States, supra.
Petitioners have not shown that the proceeds from the sales
of properties, or interest income, or money from relatives
received before January 1, 1988, were not deposited before that
date. Conversely, there is evidence that one or both of the
Takaos had deposited a significant amount of money in various
bank accounts before that date. For example, a schedule of
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