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Commissioner, T.C. Memo. 2000-257, affd. without published
opinion 275 F.3d 33 (3d Cir. 2001), and where the taxpayer has
taken an active and controlling role in the process of preparing
the tax returns and the information used for their preparation.
During the examination of petitioner’s returns, respondent
served a third-party recordkeeper summons on Mr. Miles and a
summons on petitioner, both of which requested information for
petitioner’s 1985 through 1988 tax years. Petitioner did not
comply with the summons issued to him, and, at petitioner’s
behest, Mr. Miles did not provide any requested information.
Respondent was forced to pursue enforcement in court of those
summonses. Petitioner’s refusal to cooperate with respondent in
determining his correct income tax liability is indicia of fraud.
See Rowlee v. Commissioner, 80 T.C. at 1125.
We also consider petitioner’s testimony at trial to be
evidence of his fraudulent intent for the years at issue. We
find that petitioner’s testimony at trial was evasive and
inconsistent, and we do not find it credible:
Although mere refusal to believe the taxpayer’s
testimony does not discharge the Commissioner’s burden,
the lack of credibility of the taxpayer’s testimony,
the inconsistencies in his testimony and his
evasiveness on the stand are heavily weighted factors
in considering the fraud issue.” [Toussaint v.
Commissioner, 743 F.2d 309, 312 (5th Cir. 1984), affg.
T.C. Memo. 1984-25; citations omitted.]
Petitioner was unable to explain credibly his failure to report
the amounts of income from his real estate sales transactions.
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