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was actually deposited into their accounts and that the remaining
$20,000 was used to “pay expenses”.
An alleged loan agreement between petitioner and his father
was presented at trial but was not received into evidence because
petitioners had failed to comply with the Court’s standing
pretrial order concerning exchange of documents. The late
production of the document prejudiced respondent’s ability to
test its authenticity. In any event, there was no reliable
evidence of funds actually transferred to petitioner from his
father. Petitioners failed to file a trial memorandum required
by the Court’s standing pretrial order, but at the calendar call
petitioners’ counsel represented to the Court that petitioner’s
mother would be a witness. She was never called to testify,
leaving petitioner’s testimony uncorroborated. The
uncorroborated testimony offered by petitioner lacks credibility
and contradicts the stipulations, and we decline to accept
petitioners’ belated explanation as proof of nontaxable deposits.
See, e.g., Tokarski v. Commissioner, 87 T.C. at 76-77.
Petitioner testified at trial that about $27,000 of NHIL’s
receipts were deposits from customer accounts that were later
refunded or returned to the customers. Petitioners failed to
provide any documentation of these refunds until the day before
trial occurred and have not shown that they represented items
included in their reported receipts. Petitioners also failed to
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