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erroneous once the Court determines that the Commissioner
provided the minimal evidentiary showing.2 Gatlin v.
Commissioner, 754 F.2d 921, 923 (11th Cir. 1985) (citing Jackson
v. Commissioner, 73 T.C. 394, 401 (1979)), affg. T.C. Memo. 1982-
489.
Respondent determined on the basis of documentary evidence
that Regal omitted gross receipts from sales of wheels and axles.
We found Mr. Roach, Mrs. Roach, and Mr. Gibson to be credible
witnesses. The testimony of these witnesses further supported
the contemporaneous receipts. The receipts indicate that Regal
received cash payments greater than the amounts it reported on
its returns.
When asked why Regal did not report gross receipts from
sales of wheels and axles as such on its returns, Mr. Coyle
explained that he and Mr. Herman thought that it was “not
something necessarily that needs to be broken out”. We find this
assertion by Mr. Coyle not to be credible.
We conclude that Regal received gross receipts from sales of
wheels and axles of $13,948 and $45,741 for the tax years ending
2 Petitioners bear the burden of proof with respect to the
underpayments of tax. Rule 142(a)(1). Sec. 7491 does not shift
the burden of proof to respondent with respect to the
underpayments of tax because petitioners have neither alleged
that sec. 7491 is applicable nor established that they complied
with the requirements of sec. 7491(a)(2)(A) and (B) to
substantiate items, maintain required records, and fully
cooperate with respondent’s reasonable requests.
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