- 8 - Assuming, as other courts have required,3 that the Commissioner must provide an evidentiary foundation for the determination that a taxpayer has received unreported income, we are satisfied that the New York consent form reflecting an increase to petitioners' State taxable income for 1995 constitutes predicate evidence in the instant case for respondent's determination in the notice of deficiency. Petitioners' admission to an additional State income tax liability due to unreported income provides a sufficient link to their income-generating acts. Petitioners argue that the New York consent form is ambiguous and could stem from disallowed deductions. To the contrary, we note that the language of the New York consent form states that the State audit disclosed an increase in petitioners' income and shows no disallowed deductions. Such evidence is sufficient to satisfy any predicate evidence requirement. Accordingly, we hold that the notice of deficiency in the instant case is presumed correct and the burden of proof is on petitioners. III. Exclusion of Testimony of Petitioners' Witness Before agreeing to submit the case to the Court as fully stipulated, petitioners argued that they agreed to a settlement with the State of New York Department of Taxation and Finance to 3 See Portillo v. Commissioner, 932 F.2d 1128, 1134 (5th Cir. 1991), affg. in part and revg. in part T.C. Memo. 1990-68; Anastasato v. Commissioner, 794 F.2d 884, 887 (3d Cir. 1986), vacating and remanding T.C. Memo. 1985-101; Rapp v. Commissioner, 774 F.2d 932, 935 (9th Cir. 1985), affg. an unreported Order of this Court.Page: Previous 1 2 3 4 5 6 7 8 9 10 Next
Last modified: May 25, 2011