Henry F. K. Kersting - Page 9




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          the determination.  See United States v. Janis, 428 U.S. 433,               
          441-442 (1976); Weimerskirch v. Commissioner, 596 F.2d 358, 360             
          (9th Cir. 1979), revg. 67 T.C. 672 (1977).  The rationale for               
          this exception is based on the recognized difficulty the taxpayer           
          bears in proving the nonreceipt of income.  See Elkins v. United            
          States, 364 U.S. 206 (1960); Flores v. United States, 551 F.2d              
          1169, 1175 (9th Cir. 1977).  When the determination is considered           
          arbitrary and erroneous, the presumption of correctness is                  
          destroyed.  See United States v. Janis, supra at 442;                       
          Weimerskirch v. Commissioner, supra.                                        
               Petitioner's contention that respondent's determination is             
          arbitrary and erroneous is without merit.  Petitioner stipulated            
          to the District Court's opinion in Kersting (Consolidated Cases)            
          and stipulated to nearly the entire record in Kersting                      
          (Consolidated Cases), including voluminous testimony and                    
          exhibits.  After an extensive examination of the voluminous                 
          record, the District Court released a detailed 107-page opinion,            
          and respondent's determination is based squarely thereon.                   
               During trial of this case, petitioner neither presented                
          witnesses nor made any meaningful attempt to rebut the                      
          overwhelming evidence supporting respondent's determination,                
          evidence to which petitioner stipulates.  Respondent has amply              
          demonstrated the requisite "predicate evidence" supporting his              
          determination.  Petitioner nonsensically argues the determination           





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