Edward Nathan Levine - Page 14

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          omitted from petitioner's returns.  United States v. Merrick, 464           
          F.2d 1087, 1092 (10th Cir. 1972).  In this case, where petitioner           
          has failed to keep the required records, respondent was justified           
          in determining petitioner's tax liabilities for the years at                
          issue by this method.  Parrish v. Commissioner, T.C. Memo. 1997-            
          474; McManus v. Commissioner, T.C. Memo. 1972-200, affd. without            
          published opinion 498 F.2d 1399 (4th Cir. 1973).                            
               Petitioner testified at trial that all of the money actually           
          belonged to two men, "Cos" and "Bro", who gave him living                   
          expenses and drugs as gifts in appreciation of his renting the              
          boxes and depositing the money into the boxes on their behalf.              
          Petitioner estimated the value of these gifts was $48,900 in                
          1987, and $55,600 in 1988.  Petitioner testified that when Cos              
          and Bro needed to contact him they would beep him on his                    
          electronic pager.  Petitioner testified that the last time he had           
          contact with Cos and Bro was in 1988 when they gave him phony               
          identification in the name of Robert Morrison and the attache               
          case full of cash to deposit in the Univault box.  Petitioner did           
          not call Cos and Bro as witnesses or produce any other evidence             
          that could verify his story.                                                
               Petitioner relies on only his testimony to carry the burden            
          of proving the source of the bundles of cash.  Thus, the issue is           
          one of credibility wherein we must determine the extent to which            
          the proffered testimony is believable.  See Schad v.                        
          Commissioner, supra at 620.                                                 




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