James J. Brookbank - Page 2




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                                       Additions to Tax, I.R.C.                       
                              Sec.            Sec.           Sec.                     
          Year     Deficiency     6653(b)(1)      6653(b)(2)        6654              
          1982     $ 4,551         $2,276       50% of interest     $444              
                                        due on $4,551                                 
          1983       6,401          3,201       50% of interest      392              
                                             due on $6,401                            
          1984      15,843          7,922       50% of interest      997              
                                  due on $15,843                                     

          Unless otherwise indicated, all section references are to the               
          Internal Revenue Code in effect for the years in issue, and all             
          Rule references are to the Tax Court Rules of Practice and                  
          Procedure.                                                                  
               Petitioner did not appear for trial.  Respondent filed                 
          motions for judgment by default and for a penalty under section             
          6673.                                                                       
          Respondent's Motion for Judgment by Default                                 
               Respondent's Motion for Judgment by Default relies on facts            
          and evidence deemed stipulated pursuant to an Order of the Court            
          made under Rule 91(f)(3) and, in addition, on facts pleaded in              
          the answer.  Respondent contends that those materials are                   
          sufficient to carry respondent's burden of proof because of                 
          petitioner's default, relying on Smith v. Commissioner, 91 T.C.             
          1049 (1988), affd. 926 F.2d 1470 (6th Cir. 1991).  Respondent,              
          however, also called two witnesses in further support of                    
          respondent's determination of fraud.  The witnesses testified to            
          income paid to petitioner during the years in issue and                     
          admissions made by petitioner about avoiding payment of income              



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