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estate were legitimate. Respondent argues they were not.
Respondent has generally determined that the estate, acting
through its coexecutors: (1) Attempted to conceal assets from
the Government, (2) intentionally undervalued assets, and
(3) intentionally overvalued deductions. Respondent has adjusted
the reported values of the subject assets and deductions,
determined values for the unreported assets, and determined that
the estate committed fraud. The estate generally argues that it
did nothing fraudulent. According to the estate, it may have
misvalued some of the reported assets and deductions, and failed
to report some other assets, but it did not do so with the
requisite fraudulent intent. The estate also asserts that it did
not misvalue the items to the extent determined by respondent.
We must disentangle the proffered values of decedent's
wealth and determine whether the disputed items are adjustments
to his reported taxable estate. We also must pass on
respondent's determination of fraud. Fraud is a powerful
assertion that we do not take lightly. A bright line exists
between fraudulent and negligent conduct, and an attempt to
remove value from an estate does not necessarily constitute
fraud. One is not required to arrange his or her affairs so that
the Government will receive more tax than it is rightfully owed.
Nor is it fraudulent to construe an ambiguous law reasonably in a
manner that is adverse to the Government. Fraud occurs, however,
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