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owing. See Petzoldt v. Commissioner, 92 T.C. 661, 698 (1989). A
finding of fraud requires a showing that the taxpayer intended to
evade tax known or believed to be owing by conduct intended to
conceal, mislead, or otherwise prevent the collection of taxes.
See Korecky v. Commissioner, 781 F.2d 1566, 1568 (11th Cir.
1986), affg. T.C. Memo. 1985-63.
Fraud is never presumed but must be proved by clear and
convincing evidence. See Petzoldt v. Commissioner, supra at 699.
Because direct proof of a taxpayer’s intent is rarely available,
however, fraudulent intent may be established by circumstantial
evidence. See Spies v. United States, 317 U.S. 492, 499 (1943);
Bradford v. Commissioner, 796 F.2d 303, 307 (9th Cir. 1986),
affg. T.C. Memo. 1984-601; Korecky v. Commissioner, supra at
1568; Stephenson v. Commissioner, 79 T.C. 995, 1005-1006 (1982),
affd. 748 F.2d 331 (6th Cir. 1984). The taxpayer’s entire course
of conduct may be examined to establish the requisite intent.
See Stone v. Commissioner, 56 T.C. 213, 224 (1971); Otsuki v.
Commissioner, 53 T.C. 96, 105-106 (1969).
For the reasons described below, we conclude that respondent
has established that petitioner had underpayments for each of the
years in issue and that he had fraudulent intent with respect
thereto.
Based on the stipulations regarding both petitioner’s
unreported income and the deductions allowed by respondent, and
based on our holdings herein regarding petitioner’s alleged
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