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resulting from the taxpayer's fraud.” Helvering v. Mitchell, 303
U.S. 391, 401 (1938).
Fraud denotes intentional wrongdoing on the part of the
taxpayer with the specific purpose of evading a tax known or
believed to be owing. Petzoldt v. Commissioner, 92 T.C. 661, 698
(1989). Fraud is shown by proof that the taxpayer intended to
conceal, mislead, or otherwise prevent the collection of his or
her taxes and that there is an underpayment of tax. Spies v.
United States, 317 U.S. 492, 499 (1943); Stoltzfus v. United
States, 398 F.2d 1002, 1005 (3d Cir. 1968); Webb v. Commissioner,
394 F.2d 366, 377 (5th Cir. 1968), affg. T.C. Memo. 1966-81;
Rowlee v. Commissioner, supra at 1123. Thus, in order to sustain
his burden as to fraud, respondent must prove that: (1)
Petitioner underpaid his taxes for the relevant years, and (2)
some part of each underpayment was due to fraud.2
It is well settled in this Court that the Commissioner may
establish fraud by relying upon matters deemed admitted under
Rule 90. Marshall v. Commissioner, 85 T.C. 267 (1985); Morrison
v. Commissioner, 81 T.C. 644, 651 (1983); Doncaster v.
Commissioner, 77 T.C. 334, 336 (1981). The Commissioner may also
establish fraud by relying on facts deemed to be stipulated under
2If respondent establishes that some part of the
underpayment for a year is due to fraud, all of the underpayment
is deemed attributable to fraud unless petitioner proves
otherwise. See sec. 6653(b)(2), as in effect for 1986 through
1988; sec. 6663(b), as in effect for 1989.
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