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changes in language, to section 6663 and termed a “penalty”.
Omnibus Budget Reconciliation Act of 1989, Pub. L. 101-239, sec.
7721(a), (d), 103 Stat. 2395, 2400 (“effective for returns the
due date for which (determined without regard to extensions) is
after 12/31/89”).
Under both these provisions, respondent must prove by clear
and convincing evidence that some portion of the underpayment in
petitioner’s tax for each of the years in issue was due to fraud.
Respondent is not required to prove the precise amount of the
underpayment resulting from fraud, but only that some part of the
underpayment is attributable thereto. See Otsuki v.
Commissioner, 53 T.C. 96, 105 (1969). The burden then shifts to
petitioner to show any portion of the underpayment that was not
due to fraud. Sec. 6653(b)(2) (1988); sec. 6663(b).
For the purposes of the civil tax statutes, fraud is an
intentional wrongdoing on the part of the taxpayer with the
specific purpose of evading tax believed to be owed. See Powell
v. Granquist, 252 F.2d 56 (9th Cir. 1958); Mitchell v.
Commissioner, 118 F.2d 308, 310 (5th Cir. 1941), revg. and
remanding 40 B.T.A. 424 (1939). Negligence of a taxpayer,
whether slight or gross, is not sufficient to prove fraud. See
Mitchell v. Commissioner, supra at 310. To prove fraud, the
Commissioner must show that the taxpayer intended to evade taxes
believed to be owing by conduct intended to conceal, mislead, or
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