James J. Coyle - Page 20

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          of Trompeter v. Commissioner, 111 T.C. 57, 58 (1998).  An                   
          underpayment under sections 6663 and 6664(a) has the same meaning           
          as a deficiency in section 6211(a).                                         
               To prove fraud respondent has presented evidence of and                
          relied on Regal’s conduct with respect to the omitted gross                 
          receipts from sales of wheels and axles.  However, as a result of           
          the corresponding deductions determined and allowed, these                  
          adjustments do not result in underpayments of tax.  The                     
          underpayments of tax come from other items (i.e., the denied bad            
          debt deduction, the denied deductions for State sales taxes, and            
          unreported volume rebate income).                                           
               To prove fraud under section 6663(b), respondent is required           
          to prove by clear and convincing evidence that a part of the                
          underpayment for each year is attributable to fraud.  Respondent            
          has not clearly and convincingly proven that any part of the                
          underpayment of tax due from Regal for the tax years ending                 
          March 31, 1992 and 1993, is attributable to fraud.  See Kreimer             
          v. Commissioner, T.C. Memo. 1983-672.  Accordingly, we conclude             
          that Regal is not liable for the fraud penalties under section              
               We now consider whether Mr. Coyle is liable for the fraud              
          penalties.  On the basis of our discussion above, we are                    
          satisfied that there is an underpayment of tax with respect to              
          commission income required to be shown on each of Mr. Coyle’s               

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