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Mr. London concedes that his guilty plea to tax
evasion in violation of section 7201 for 1985 estops him
from denying liability for additions to tax for fraud under
section 6653(b)(1) and (b)(2) for that year. The issues
remaining for decision are whether Mr. London is liable for
the additions to tax for fraud for petitioners' 1983 return
and whether Mrs. London is liable for the additions to tax
for fraud for 1983 and 1985.
Respondent contends that the following facts, when
taken as a whole, establish that petitioners' underpayment
of tax for 1983 and 1985 was attributable to fraud: (1)
There is a large discrepancy between petitioners' actual
income and the income reported on their returns for 1983
and 1985; (2) petitioners did not keep adequate books or
records from which their tax liability could be computed;
(3) Mr. London was engaged in illegal activities;
(4) Mr. London attempted to conceal his illegal activities;
(5) Mrs. London was actively involved in petitioners'
finances; (6) Mr. London did not supply complete
information about the check-cashing business' income
and expenses to Mr. Trugman, the accountant who prepared
the Schedule C for M.L. Associates; and (7) Mrs. London's
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