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Where fraud is determined for each of several years,
respondent’s burden applies separately for each of the years.
See Estate of Stein v. Commissioner, 25 T.C. 940, 959-963 (1956),
affd. sub nom. Levine v. Commissioner, 250 F.2d 798 (2d Cir.
1958); McLaughlin v. Commissioner, 29 B.T.A. 247, 249 (1933). A
mere understatement of income does not establish fraud. However,
a pattern of consistent underreporting of income for a number of
years is strong evidence of fraud. See Estate of Mazzoni v.
Commissioner, 451 F.2d 197, 202 (3d Cir. 1971), affg. T.C. Memos.
1970-144 and 1970-37; Adler v. Commissioner, 422 F.2d 63, 66 (6th
Cir. 1970), affg. T.C. Memo. 1968-100; Otsuki v. Commissioner, 53
T.C. at 108.
The issue of fraud is a factual question that is to be
decided on an examination of all the evidence in the record. See
Plunkett v. Commissioner, 465 F.2d at 303; Mensik v.
Commissioner, 328 F.2d 147, 150 (7th Cir. 1964), affg. 37 T.C.
703 (1962); Stone v. Commissioner, 56 T.C. at 224.
In order to establish fraud as to a taxpayer, respondent
must show that that taxpayer intended to evade taxes which that
taxpayer knew or believed were owed, by conduct intended to
conceal, mislead, or otherwise prevent the collection of taxes.
See, e.g., Grossman v. Commissioner, 182 F.3d 275, 277 (4th Cir.
1999), affg. T.C. Memo. 1996-452; Powell v. Granquist, 252 F.2d
56, 60 (9th Cir. 1958); Danenberg v. Commissioner, 73 T.C. 370,
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