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taxpayer may be liable for an addition to tax for fraud, even
where he causes the income to be reported on the returns of
family members or others and pays the taxes due thereon. See
Hecht v. Commissioner, 16 T.C. 981, 987 (1951); Lang v.
Commissioner, T.C. Memo. 1961-134 (taxpayer could not excuse
himself of understatement of tax due to fraud by shifting his
income to family members). In any event, petitioner never
instructed his son to report the receipt of the stock or its sale
in 1985 and merely assumed his son properly reported the income.
Petitioner argues that his reliance on his accountants is a
defense to fraud. “Reliance on a bookkeeper or accountant is no
defense to fraud if the taxpayer failed to provide the accountant
‘with all of the data necessary for maintaining complete and
accurate records’”. Korecky v. Commissioner, 781 F.2d 1566, 1569
(11th Cir. 1986) (quoting Merritt v. Commissioner, 301 F.2d 484,
487 (5th Cir. 1962), affg. T.C. Memo. 1959-172), affg. T.C. Memo.
1985-63. Since petitioner admits that he never told his
accountants that he owned the Wedtech stock, his reliance on his
accountants is not a defense to fraud.
c. Conclusion
We sustain respondent’s additions to tax on account of fraud
under section 6653(b)(1).
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