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respondent’s agents. Thus, section 7491(a) does not apply.3
Sec. 7491(a); Rule 142(a)(2).
2. Whether the Notices of Deficiency Were Arbitrary
Petitioner contends that the notices of deficiency are not
entitled to the presumption of correctness, and that respondent
bears the burden of going forward to establish the existence and
amounts of the deficiencies because respondent’s determinations
were arbitrary. Helvering v. Taylor, 293 U.S. 507 (1935). We
disagree.
Petitioner contends that the notices of deficiency were
arbitrary because respondent made several concessions and because
respondent did not establish petitioner’s cost bases in the
securities she sold during the years in issue before sending the
notices of deficiency. We disagree. Petitioner did not file
returns for the years in issue. Respondent reasonably determined
petitioner’s income based on information returns received from
third-parties reporting payments made to petitioner during the
years in issue. Respondent’s concessions were based on
substantiation provided by petitioner after respondent sent the
notices of deficiency. Respondent issued the notices of
deficiency without knowing petitioner’s bases in various assets
3 For similar reasons, sec. 6201(d) does not place on
respondent the burden of producing evidence to supplement the
information returns. See McQuatters v. Commissioner, T.C. Memo.
1998-88.
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