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For the foregoing reasons, we do not believe that respondent
has shown by clear and convincing evidence that Neal’s actions
provide a basis for attributing fraud to Simco. If Simco has
committed fraud, it can only be because John’s actions are
attributable to it.
Simco filed amended tax returns for each of the fiscal years
1989 and 1990 showing increases in tax owed, effectively
conceding that there was an underpayment in each year. Thus, the
issue is whether Simco acted with fraudulent intent. See sec.
6663(a). In deciding this issue, the pertinent questions are:
(1) Whether the wrongdoing officer or agent had sufficient
control of the corporation that his fraudulent acts should be
imputed to the corporation, and (2) whether the wrongdoer was
acting in behalf of, and not against the interests of, the
corporation. See Ruidoso Racing Association, Inc. v.
Commissioner, 476 F.2d 502, 506 (10th Cir. 1973), affg. in part
and remanding in part on another ground T.C. Memo. 1971-194;
Botwinik Bros. of Mass., Inc. v. Commissioner, 39 T.C. at 996;
Federbush v. Commissioner, 34 T.C. 740, 750 (1960), affd. per
curiam 325 F.2d 1 (2d Cir. 1963); Moore v. Commissioner, T.C.
Memo. 1977-275, affd. 619 F.2d 619 (6th Cir. 1980). In the
instant case, John, the wrongdoer, was not the sole stockholder.
Cf. Federbush v. Commissioner, supra. He did not so dominate the
corporation that it was a creature of his will. Cf. Frankland
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