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Mr. Zhadanov’s 1993 return actually showed the Social
Security benefits he received during 1993 (line 21(a)), but the
return does not contain a completed entry on the relevant income
line (line 21(b)). Mr. Zhadanov admitted at trial that he
received the Social Security benefits in question and that he did
not pay tax on those benefits for 1993, but he did not present
any additional evidence or make any further argument regarding
respondent’s adjustment. We conclude, therefore, that Mr.
Zhadanov has conceded this issue (assuming that the issue is not
computational in nature), Bradley v. Commissioner, 100 T.C. 367,
370 (1993); Rybak v. Commissioner, 91 T.C. 524, 566 n.19 (1988),
and sustain respondent’s adjustment accordingly.18
B. Fraud Penalty Determined Against the Zhadanovs
Respondent determined that the Zhadanovs were jointly liable
for a fraud penalty under section 6663 for 1990, 1991 and 1992,
and that Mr. Zhadanov and Mrs. Zhadanov were each liable for a
fraud penalty for 1993. Respondent bears the burden of proving
by clear and convincing evidence that an underpayment exists and
that the underpayment is attributable to fraud. Sec. 7454(a);
Rule 142(b).
18We note, however, that Mr. Zhadanov’s 1993 return showed a
negative adjusted gross income figure and no taxable income.
Even after Mr. Zhadanov’s deemed concession is taken into
account, it does not appear that Mr. Zhadanov will have any
underpayment of tax for 1993, but we leave that analysis to the
Rule 155 calculation.
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