- 4 -
supporting its determination.” Portillo v. Commissioner, 932
F.2d 1128, 1133 (5th Cir.), affg. in part and revg. and remanding
in part T.C. Memo. 1990-68. If the presumption of correctness
does not apply, respondent’s determination will be deemed
arbitrary, and he will bear the burden of proving it correct.
See Sealy Power, Ltd. v. Commissioner, 46 F.3d 382, 386 (5th Cir.
1995), affg. in part and revg. and remanding in part T.C. Memo.
1992-168. Thus, respondent must establish that he had predicate
evidence for his determinations that petitioner received self-
employment income relating to 1993 through 1996.1
Respondent has established that he had predicate evidence
(i.e., the questionnaire) for his determinations that petitioner
received self-employment income in 1995 and 1996. The
presumption of correctness is applicable, and petitioner failed
to present sufficient evidence establishing that these
determinations are erroneous. Accordingly, we sustain
respondent’s determinations relating to petitioner’s income and
self-employment tax deficiencies relating to 1995 and 1996.
Respondent failed, however, to establish that he had
predicate evidence for his determinations that petitioner
1 Respondent, citing Parker v. Commissioner, 117 F.3d 785
(5th Cir. 1997), contends that he does not have to establish
predicate evidence for these determinations. We disagree. The
holding in Parker applies only to Commissioner’s determinations
relating to income reported by third-party payors. See id. at
787 (holding that respondent has no duty to investigate third-
party payment reports that are not disputed by the taxpayer).
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