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stock was received. Also, petitioner's receipt of the stock in
payment for legal services was disguised as a purchase and sale.
Respondent has established by clear and convincing evidence that
petitioner fraudulently underreported and underpaid his Federal
income taxes for 1987 and 1988. We conclude that the fraud addition
to tax applies to the entire underpayment for each year. Sec.
6653(b)(2).
Because petitioner fraudulently filed his 1987 and 1988 Federal
income tax returns, the period of limitations does not bar assessment
of income tax for those years. Sec. 6501(c)(1).
Petitioner makes no separate argument for 1987 and 1988
regarding the substantial understatement addition to tax. In light
of our findings and conclusions herein regarding petitioner’s failure
to report his correct income for 1987 and 1988, we sustain
respondent’s determination of the substantial understatement
addition.
To reflect the foregoing,
Decisions will be entered
under Rule 155.
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