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In this case, respondent has produced more than
adequate substantive evidence linking petitioner to income
from the sale of marijuana in 1983. This includes
petitioner's criminal conviction arising from the Michigan
transaction, petitioner's own testimony during the plea
hearing in the criminal case, testimony of law enforcement
officers, and detailed testimony of coconspirators.
Indeed, petitioner stipulates that he was engaged in the
sale of marijuana during 1983. Under the circumstances,
we find that respondent has more than satisfied
respondent's initial burden of producing some substantive
evidence connecting petitioner with an income-producing
activity, and we find that the burden of disproving
respondent's determination of unreported income remains
with petitioner.
We also sustain respondent's calculation of the amount
of petitioner's unreported income. Section 6001 requires
all taxpayers to maintain sufficient records to determine
their correct tax liability. See Petzoldt v. Commissioner,
supra at 686. If a taxpayer fails to maintain or does not
produce adequate books and records, the Commissioner is
authorized by section 446 to reconstruct the taxpayer's
income. See sec. 446(b); Petzoldt v. Commissioner, supra
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