- 7 - Investigation Division. He was involved with petitioner’s grand jury investigation and testified that he had prepared reports and computations of petitioner’s tax liabilities exclusively for use in the grand jury proceedings. He also testified that he was unaware that any of those reports or computations were used by respondent in the course of the audit underlying the notice of deficiency. The second witness, one of respondent’s revenue agents, provided no testimony that would support petitioner’s allegation. On the record before us, we are unpersuaded that respondent relied on any grand jury material in the formulation of the notice of deficiency. We hold that the notice of deficiency is valid. Accordingly, we sustain respondent’s determination as to the deficiencies and the additions to tax under section 6661(a). We turn next to respondent’s determination that petitioner is liable for the additions to tax for fraud under section 6653(b) and an accuracy-related penalty for fraud under section 6663. Respondent must prove this determination by clear and convincing evidence. Sec. 7454(a); Rule 142(b); Castillo v. Commissioner, 84 T.C. 405, 408 (1985); Rowlee v. Commissioner, 80 T.C. 1111, 1113 (1983). An addition to tax (or accuracy-related penalty) for fraud is a civil sanction “provided primarily as a safeguard for the protection of the revenue and to reimburse the Government for the heavy expense of investigation and the lossPage: Previous 1 2 3 4 5 6 7 8 9 Next
Last modified: May 25, 2011