Alber I. and Georgette H. Said - Page 12

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               Respondent must show that petitioner acted with fraudulent             
          intent.  The facts in this case include many “badges of fraud”.             
          Petitioner substantially and consistently understated his income            
          for each of the years in issue.  Petitioner failed to cooperate             
          with respondent and offered inconsistent explanations for items             
          on the returns.  Petitioner did not maintain complete and                   
          accurate records of his income-producing activities and did not             
          produce complete records during examination.  Even when                     
          petitioner produced documents to substantiate the information on            
          the returns, the records were in disarray and were incomplete.              
          In addition, petitioner’s business involved many cash                       
          transactions.  Considering his education as an accountant and the           
          degree of noncompliance with record keeping requirements, we                
          infer an intention to conceal and deceive.                                  
               Petitioner, and his representative, also made false and                
          misleading statements to Pascual during the examination.                    
          Petitioners’ representative told Pascual that petitioners had no            
          personal bank accounts, which later proved to be false.  There is           
          also evidence that petitioner attempted to alter records by                 
          changing the numbers on his gasoline log sheets in order to claim           
          more costs of goods sold and deductions.                                    
               Respondent has proven by clear and convincing evidence an              
          underpayment of tax due to fraud for each year.  Petitioner has             
          not proven that any part of the underpayment is not attributable            






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