James J. Coyle - Page 13

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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-           
               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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