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adjustments the Court can conclude that the
deficiency is arbitrary and unreasonable.
Portillo v. Commissioner, 932 F.2d 1128, 1132
(5th Cir. 1991); Jackson v. Commissioner, 73
T.C. 394, 396-97, 402 (1979). Without this
presumption of correctness the IRS must do more
than submit its belief that Mr. Vetrano had this
income. They did not present any such evidence,
in fact they presented evidence that Mr. Vetrano
had no such unreported income through the
testimony of Mr. Gartland. A decision in favor
of both Mr. and Mrs. Vetrano is warranted under
these facts.
We agree with respondent that the underpayment in each
of the years in issue is attributable to the fraud of
Mr. Vetrano. Respondent established that the portion of
the underpayment in each year attributable to the payments
from BMAP is due to fraud. The record shows that
petitioner engaged in an automobile parts business and
realized substantial income from selling automobile parts
to BMAP in each of those years. Petitioner took steps to
conceal the income that he earned from his automobile parts
business from his accountant, from his ex-wife, and from
the Internal Revenue Service. These steps included, among
others, failing to maintain or produce books and records
regarding his automobile parts business, conducting his
business and personal affairs almost entirely in cash, and
providing false information to his former spouse and to the
court in his divorce action.
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