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requirements under the Internal Revenue Code, sec. 7491(a)(2)(A);
(2) maintained all records required by the Internal Revenue Code,
sec. 7491(a)(2)(B); (3) cooperated with reasonable requests by
the Secretary for information, documents, and meetings, id.; and
(4) introduced at trial credible evidence with respect to any
factual issue relevant to ascertaining his or her liability for
any tax imposed under subtitle A or B, sec. 7491(a)(1).4
Petitioner did not substantiate his deductions, keep records
of his income and expenses, or cooperate with respondent’s
agents. Thus, petitioner bears the burden of proving that
respondent’s determination is incorrect as to the items of income
and deduction disallowed in the notice of deficiency. Sec.
7491(a); Rule 142(a)(2).
B. Whether Petitioner Had Unreported Income
Respondent contends respondent’s bank deposits analysis
shows that petitioner had unreported income of $64,108.94 in 1996
and $21,942.75 in 1997. Petitioner does not dispute respondent’s
3(...continued)
records required under this title and
has cooperated with reasonable requests
by the Secretary for witnesses,
information, documents, meetings, and
interviews; * * *.
4 Sec. 7491 applies to court proceedings arising in
connection with examinations beginning after July 22, 1998. See
Internal Revenue Service Restructuring & Reform Act of 1998, Pub.
L. 105-206, sec. 3001(a), 112 Stat. 726. The examination in this
case began after July 22, 1998. Thus, sec. 7491 applies.
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