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business and petitioners’ commingling of the funds, calculated
for Federal income tax purposes the amount of any loan that he
believed existed between petitioners and Nanny’s by virtue of
their use of its funds and vice versa. We are unable to conclude
on the basis of the record at hand that petitioners knew when
they filed their tax returns that Mr. Mason’s calculation may
have reflected inaccurately their use of Nanny’s funds. Nor do
we believe that the mere fact that petitioners commingled their
personal funds with the funds of Nanny’s, and knew that they did
so, means ipso facto that petitioners possessed the requisite
fraudulent intent when they filed their income tax returns.
Our conclusion is unchanged by the fact that the Bank issued
the STRs as to petitioners. As we view the transactions
underlying the STRs, we are unable to conclude that those
transactions, which occurred in only the last 2 years in issue,
lead to a finding that petitioners possessed the requisite
fraudulent intent in any of the years. Ten of the reported
transactions involved payments on loans which presumably included
the Social Security number of one or both petitioners. The
remaining transactions concerned petitioners’ purchase of
cashier’s checks, no two of which were on the same day and each
of which was somewhat spread out from another. Although all of
the cashier’s checks were in amounts less than $10,000, none of
those checks, but for three of the $9,000 checks payable to Mr.
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