Jerry V. Rice - Page 5

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          Helvering v. Mitchell, 303 U.S. 391, 401 (1938).  Respondent has            
          the burden of proving, by clear and convincing evidence, an                 
          underpayment for 1989 and that some part of an underpayment for             
          that year was due to fraud.  Sec. 7454(a); Rule 142(b).  If                 
          respondent establishes that any portion of the underpayment is              
          attributable to fraud, the entire underpayment is treated as                
          attributable to fraud and subjected to a 75-percent penalty                 
          unless the taxpayer establishes that some part of the                       
          underpayment is not attributable to fraud.  Sec. 6663(b).                   
          Respondent's burden is met if it is shown that the taxpayer                 
          intended to conceal, mislead, or otherwise prevent the collection           
          of taxes.  Rowlee v. Commissioner, 80 T.C. 1111, 1123 (1983).               
               The existence of fraud is a question of fact to be resolved            
          upon consideration of the entire record.  King's Court Mobile               
          Home Park, Inc. v. Commissioner, 98 T.C. 511, 516 (1992).  Fraud            
          will never be presumed.  Beaver v. Commissioner, 55 T.C. 85, 92             
          (1970).  Fraud may, however, be proved by circumstantial evidence           
          and inferences drawn from the facts because direct proof of a               
          taxpayer's intent is rarely available.  Niedringhaus v.                     
          Commissioner, 99 T.C. 202, 211 (1992).  The taxpayer's entire               
          course of conduct may establish the requisite fraudulent intent.            
          Stone v. Commissioner, 56 T.C. 213, 223-224 (1971).                         
               Petitioner argues that there is no underpayment of tax in              
          this case and that, without an underpayment, respondent cannot              

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