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inaccurate. See Price v. United States, 335 F.2d 671, 677 (5th
Cir. 1964); Goe v. Commissioner, 198 F.2d 851 (3d Cir. 1952);
Tokarski v. Commissioner, 87 T.C. 74, 76-77 (1986); Alvarez v.
Commissioner, T.C. Memo. 1995-414. Petitioners chose to present
no substantive evidence and to call no witnesses. At trial,
petitioner husband sought to read from a prepared statement
contending that the Federal income tax is an indirect tax under
Article 1, Section 8, Clause 1 of the Constitution, and that
petitioners did not engage in any “excise taxable activities”.
Petitioners’ trial memorandum advances similar arguments.
Petitioners’ arguments are without merit and have long been
rejected. In Abrams v. Commissioner, 82 T.C. 403, 406-407
(1984), for instance, this Court stated:
Since the ratification of the Sixteenth Amendment,
it is immaterial with respect to income taxes, whether
the tax is a direct or indirect tax. The whole purpose
of the Sixteenth Amendment was to relieve all income
taxes when imposed from apportionment and from a
consideration of the source whence the income was
derived.
See also Ficalora v. Commissioner, 751 F.2d 85 (2d Cir. 1984);
Sickler v. Commissioner, T.C. Memo. 1994-462; Boyce v.
Commissioner, T.C. Memo. 1990-555. Respondent’s determinations
of unreported income for each of the years in issue are
sustained.
Petitioners have stipulated that the sale in 1994 of
the house that petitioner husband purchased in 1993 resulted in
capital gain of $2,340. We conclude that this capital gain
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