Ouan Bland - Page 9

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               Although the examination of petitioner’s 1998 individual               
          return commenced after July 22, 1998, respondent contends                   
          petitioner does not meet the requirements of section 7491(a).               
          Petitioner does not contend otherwise.  The Court concludes that            
          section 7491(a) is inapplicable.  However, the resolution of the            
          issues in this case does not depend on which party has the burden           
          of proof.  We resolve these issues on the preponderance of the              
          evidence in the record.                                                     
          1.  Nonemployee Compensation and Self-Employment Tax                        
               Petitioner cashed checks for Mr. Fullen and transferred the            
          proceeds to him.  She identified her signature on only three of             
          the checks in issue.  Petitioner contends the signatures on the             
          remaining 19 checks are not hers.  At trial, Mr. Fullen admitted            
          he had signed petitioner’s name to many of the checks himself.              
               The Court has examined the signatures on all of the checks             
          in issue.  Having compared those signatures to the signatures on            
          the various documents petitioner has filed with the Court, the              
          Court finds that only three of the signatures are petitioner’s.             
               “It is well settled that the mere receipt and possession of            
          money does not by itself constitute taxable income.”  Liddy v.              
          Commissioner, T.C. Memo. 1985-107, affd. 808 F.2d 312 (4th Cir.             
               This Court stated in Diamond v. Commissioner, 56 T.C. 530,             
          541 (1971), affd. 492 F.2d 286 (7th Cir. 1974):  “We accept as              

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