Kyl Christians - Page 16

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          a doctor whose income was consistently and substantially                    
          understated, the taxpayer’s reliance on his accountant was a                
          factor in the Court’s holding that the Commissioner failed to               
          clearly and convincingly prove fraud.  Zipp v. Commissioner, T.C.           
          Memo. 1998-371.                                                             
               B.  Whether There Was a Pattern of Behavior Which Indicates            
               an Intent To Mislead                                                   
               Respondent points out that petitioner, in the process of               
          applying for loans, provided monthly income figures to lenders              
          that reflected that he knew that he was underreporting his                  
          income.  During 1994, petitioner sought a $5,100 personal loan,             
          and he estimated that his monthly income was $3,200.  A few                 
          months later petitioner began the process of purchasing a home,             
          and in documents submitted to secure a $140,000 mortgage loan, he           
          estimated that his monthly income was $5,217 on one occasion and            
          $4,137 on another.                                                          
               When the home loan was being finalized, the mortgage company           
          requested copies of petitioner’s 2 prior years’ Federal income              
          tax returns.  Petitioner obtained the copies of the returns from            
          his father and provided them to the mortgage company.  Unlike the           
          returns filed with respondent, which reported insignificant                 
          amounts of net income from the construction business, the copies            
          supplied to the mortgage company reflected annual net income in             
          the low $50,000's.  In addition, there were some discrepancies              







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