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They did not deal primarily in cash in their personal capacity;
e.g., all of the rent that they received was paid by check. They
cooperated with respondent as to their audit; e.g., they promptly
gave Revenue Agent Smith their amended returns reporting
additional income for those years and expeditiously transferred
to respondent all of the records which they maintained as to
themselves individually. Although we agree with respondent that
petitioners were less than upfront with the State of Michigan in
1988 as to the purchase price of the Tollycraft, and in this
regard filed a false document with the State, this fact does not
convince us clearly that petitioners possessed the requisite
fraudulent intent for that year as to their Federal income tax
liability.9
All of the parties’ arguments have been considered, and we
have rejected those arguments not discussed herein as meritless.
Accordingly,
Decision will be entered
under Rule 155.
9 Nor do we believe that some of petitioners’ explanations
as to their behavior, explanations which we find implausible or
inconsistent, dictate a finding of fraud in any of the years.
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