Michael Robert Cottrell - Page 6

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               As noted earlier, petitioner presented no books and records            
          to substantiate his claim that expenses and losses from prior               
          years totally offset the income he realized from his trade or               
          business activity during 2000.  Although petitioner's records               
          for the year 2000 were lost, petitioner made no attempt to                  
          reconstruct his records or to offer any other evidence that                 
          would satisfy the Court that the income at issue was offset by              
          trade or business expenses or losses.  Of concern to the Court              
          is petitioner's admission at trial that he received other income            
          payments during 2000 in his trade or business activity that were            
          not reported by the payers to the Internal Revenue Service, and             
          which petitioner did not include as income on his income tax                
          return.                                                                     
               Section 6001 requires generally that every person liable               
          for any tax keep such records, render such statements, make such            
          returns, and comply with such regulations as the Secretary may              
          from time to time prescribe.  Section 1.6001-1(a), Income Tax               
          Regs., provides, in pertinent part, that "any person subject to             
          tax under subtitle A of the Code * * *, shall keep such                     

               2(...continued)                                                        
          Commissioner is conditioned upon the taxpayer's introduction of             
          credible evidence with respect to any factual issue relevant to             
          ascertaining the liability of the taxpayer and the taxpayer's               
          cooperation with reasonable requests for witnesses, information,            
          documents, meetings, and interviews.  Sec. 7491(a)(2).  The facts           
          of this case do not demonstrate to the Court that the burden of             
          proof shifted to respondent.                                                





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