- 42 -
B. Conclusion
The existence of fraud is a question of fact to be resolved
by consideration of the entire record. Parks v. Commissioner, 94
T.C. at 660; Gajewski v. Commissioner, 67 T.C. 181, 199 (1976),
affd. without published opinion 578 F.2d 1383 (8th Cir. 1978).
We do not impute or presume fraud, and we do not find fraud on
the basis of circumstances that do no more than create a
suspicion of fraud. Green v. Commissioner, 66 T.C. 538, 550
(1976). Although respondent is not required to establish fraud
beyond a reasonable doubt, the "clear and convincing" standard
requires that he establish fraud by more than a preponderance of
the evidence. Kellett v. Commissioner, 5 T.C. at 616.
Although Mr. Beck's omissions of income were substantial,
alone they do not provide clear and convincing evidence that he
intended to evade tax. The other indicia of fraud that we have
considered are inconclusive or show a lack of fraudulent intent.
Mr. Beck's explanations for his failures to report all income
were neither implausible nor inconsistent, and the circumstances
surrounding the omissions are as consistent with innocent mistake
as with willful evasion.
What has been proved is a negligent or, at most, a willful
disregard of rules or regulations. After examining the record,
we conclude that Mr. Beck lacked the specific intent to evade tax
that is required to find fraud.
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