- 10 -
rely on Bok Kim’s testimony to support petitioners’ position
herein. See Ruark v. Commissioner, 449 F.2d 311, 312 (9th Cir.
1971), affg. T.C. Memo. 1969-48; Tokarski v. Commissioner, 87
T.C. at 77.
Furthermore, petitioners have failed to introduce any
evidence whatsoever relating to the existence of any nontaxable
sources for the $542,641 in unexplained funds deposited into
their banking accounts in 1995. Petitioners make no claim that
they held on to loan and inheritance proceeds received in 1993
and 1994 before depositing them in 1995.9 Additionally, given
the cost of goods sold as stipulated in this case, petitioners
would have had to have been selling their inventory at below cost
in 1993 and 1994 if TBJ’s gross receipts were as reported. Yet
Chung Kim testified that he marked up the merchandise by almost
25 percent.
Petitioners offer no credible evidence that any of the
unexplained deposits represent loan and inheritance proceeds.
Hence, petitioners have not disproved that the excess deposits
originate from a taxable source as respondent determined.
Accordingly, respondent’s determinations, after concessions, are
sustained.
9Chung Kim testified that he never left the loan and
inheritance proceeds in his safe but rather deposited the funds
within 3 days of delivery. Additionally, TBJ’s balance sheet for
Dec. 31, 1994, reflects cash on hand and in the bank of only
$9,663.
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