- 7 -
derives readily realizable economic value from it.’” James v.
United States, supra at 219 (quoting Rutkin v. United States, 343
U.S. 130, 137 (1952)).
A taxpayer has dominion and control over cash when he or she
has the freedom to use it at will, even though that freedom may be
assailable by persons with better title. See Rutkin v. United
States, supra. This requires a court to look at all relevant facts
and circumstances. See Arcia v. Commissioner, supra; Liddy v.
Commissioner, supra. For instance, the use of money for personal
purposes is an indication of dominion and control. See Woods v.
Commissioner, T.C. Memo. 1989-611, affd. per curiam without
published opinion 929 F.2d 702 (6th Cir. 1991). However, holding
money in a fiduciary capacity, such as an agent, generally will not
require inclusion of such cash in a taxpayer's gross income. See
Diamond v. Commissioner, 56 T.C. 530, 541 (1971), affd. 492 F.2d
286 (7th Cir. 1974); Arcia v. Commissioner, supra.
With respect to the $99,880 involved herein, petitioner has
the burden of proving he did not have dominion and control over the
money; i.e., he was holding the money as agent for another. See
Rule 142(a); Erickson v. Commissioner, 937 F.2d 1548, 1551-1552
(10th Cir. 1991), affg. T.C. Memo. 1989-552; Schad v. Commissioner,
87 T.C. 609, 618-619 (1986), affd. without published opinion 827
F.2d 774 (11th Cir. 1987). Resolution of the inquiry before us
depends upon our believing petitioner's explanation that he was
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