James D. Horn - Page 22

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          any event, without reference to State law on the subject of                 
          incompetence, petitioner bears the burden of proof on this                  
          subject in this Court.  Rule 142; see Ravetti v. Commissioner,              
          T.C. Memo. 1993-343, affd. without published opinion 38 F.3d 1218           
          (9th Cir. 1994).                                                            
               Petitioner has failed to offer any credible evidence8 to               
          show:  (1) That he lacked capacity to understand the tax returns            
          and Forms 4549-CG that he signed, (2) that respondent knew or               
          should have known of his alleged incapacity, or even (3) that he            
          signed the Forms 4549-CG under compulsion of mental disease or              
          disorder.  Moreover, the evidence persuades us that petitioner              
          understood the documents he signed and that his decisions to                
          sign were entirely rational.                                                
               In May 1994, when petitioner signed Form 4549-CG for the               
          1990 tax year, he was being treated for his psychiatric problems            

               8The only evidence petitioner offered, other than his                  
          testimonial assertions regarding his mental problems, were copies           
          of medical records showing that in 1993 he had been hospitalized            
          3 weeks for depression and schizophrenia and was treated on an              
          outpatient basis for these conditions around the time in 1994 he            
          signed the first Form 4549-CG for 1990, and again at least once             
          in 1999 and 9 times in August through November 2000.  These                 
          medical records do not show that petitioner lacked the cognitive            
          ability to understand what he signed or that he signed under                
          “compulsion”.  The records also do not cover the times when                 
          petitioner signed the returns and the second Form 4549-CG.                  
          Respondent objected to admissibility of the records on relevance,           
          hearsay, and authentication grounds.  The records and                       
          petitioner’s testimony do not establish that petitioner lacked              
          cognitive capacity to understand the documents he signed or that            
          he signed under “compulsion”.                                               

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