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On the basis of the foregoing, respondent calculated that
petitioner had additional income in 1990 and 1991 from Thru The
Lens, as follows:
1990 1991
Total deposits $89,172 $63,158
Less transfers (2,900) (1,000)
Net deposits 86,272 62,158
Less business expenses (4,499) (6,168)
Net profit 81,773 55,990
Respondent's counsel then contacted petitioner and asked
whether petitioner would attend a meeting to review and explain
the entries in the bank records. Petitioner declined to do so.
At trial, we granted respondent leave to file an amendment to
answer, setting forth the increased deficiencies based upon the
inclusion of the Thru The Lens income.2
OPINION
The determinations of the Commissioner in a notice of
deficiency are presumed correct, and the taxpayer bears the
burden of proving that the determinations are in error. See Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933). In cases
involving the Commissioner’s determinations of unreported income,
2 Respondent's amendment to answer indicates petitioner
earned more than enough income to support himself during 1990.
Accordingly, respondent did not use BLS statistics to calculate
the amount of deficiencies set forth in the amendment to answer.
Nor did the deficiencies reflected in the amendment to answer
include payments of interest from Great Western Bank. Apparently
respondent omitted that interest income as a separate item
because it was part of the reconstructed income reflected as
deposits to petitioner's bank account.
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