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of the entire record. See DiLeo v. Commissioner, 96 T.C. 858,
874 (1991), affd. 959 F.2d 16 (2d Cir. 1992); Recklitis v. Com-
missioner, 91 T.C. 874, 909 (1988); Gajewski v. Commissioner, 67
T.C. 181, 199 (1976), affd. without published opinion 578 F.2d
1383 (8th Cir. 1978). Fraud is never presumed or imputed and
should not be found in circumstances which create at most only
suspicion. See Toussaint v. Commissioner, 743 F.2d 309, 312 (5th
Cir. 1984), affg. T.C. Memo. 1984-25; Petzoldt v. Commissioner,
92 T.C. 661, 700 (1989); Katz v. Commissioner, 90 T.C. 1130, 1144
(1988). Direct evidence of the requisite fraudulent intent is
seldom available. See Petzoldt v. Commissioner, supra at 699;
Rowlee v. Commissioner, 80 T.C. 1111, 1123 (1983). Consequently,
respondent may prove fraud by circumstantial evidence. See
Toussaint v. Commissioner, supra at 312; Marsellus v. Commis-
sioner, 544 F.2d 883, 885 (5th Cir. 1977), affg. T.C. Memo. 1975-
368; Rowlee v. Commissioner, supra at 1123.
The courts have identified a number of badges of fraud from
which fraudulent intent may be inferred. Those badges include
(1) consistent and substantial understatement of income;
(2) inconsistent or implausible explanations of behavior;
(3) lack of credibility of the taxpayer's testimony; (4) failure
to file a return; (5) conviction under section 7203 for failure
to file a return; and (6) failure to make estimated tax payments.
See Laurins v. Commissioner, supra at 913; Bradford v. Commis-
sioner, 796 F.2d 303, 307-308 (9th Cir. 1986), affg. T.C. Memo.
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