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protection of the revenue and to reimburse the Government for the
heavy expense of investigation and the loss resulting from a
taxpayer's fraud. See Helvering v. Mitchell, 303 U.S. 391, 401
(1938). Fraud is intentional wrongdoing on the part of the
taxpayer with the specific purpose to evade a tax believed to be
owing. See McGee v. Commissioner, 61 T.C. 249, 256 (1973), affd.
519 F.2d 1121 (5th Cir. 1975).
The Commissioner has the burden of proving fraud by clear
and convincing evidence. See sec. 7454(a); Rule 142(b). To
satisfy the burden of proof, the Commissioner must show: (1) An
underpayment existed; and (2) the taxpayer intended to evade
taxes known to be owing by conduct intended to conceal, mislead,
or otherwise prevent the collection of taxes. See Parks v.
Commissioner, 94 T.C. 654, 660-661 (1990). The Commissioner must
meet this burden through affirmative evidence because fraud is
never imputed or presumed. See Beaver v. Commissioner, 55 T.C.
85, 92 (1970).
A. Underpayment of Tax
Petitioner does not dispute that he underpaid his taxes for
1983 through 1991. We are satisfied that the Commissioner has
established by clear and convincing evidence an underpayment of
tax by petitioner for each of the years in issue.
B. Fraudulent Attempt
The Commissioner must prove that a portion of the
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