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that petitioners were able to substantiate with substantial
evidence. At the trial of these cases, petitioners and/or their
witnesses testified with regard to these items. Respondent
offered no witness or evidence to contradict their testimony.
The Court may not arbitrarily discredit or disregard
uncontradicted evidence that is competent, relevant, and
credible. The Court, however, is not bound to accept improbable,
unreasonable, or questionable testimony at face value, even if it
is uncontroverted. Banks v. Commissioner, supra at 537; Weiss v.
Commissioner, 221 F.2d 152, 156 (8th Cir. 1955), affg. T.C. Memo.
1954-51; Rand v. Helvering, 77 F.2d 450, 451 (8th Cir. 1935).
The emphasis is on credibility.
In his criminal tax proceeding, Mr. Del Bosque expressly
admitted that he omitted substantial income from his 1987, 1988,
and 1989 returns with the intent to evade taxes. For purposes of
the sentencing guidelines, Mr. Del Bosque stipulated that he
understated his taxable income in 1987, 1988, and 1989 by
$116,499 and that the corresponding tax loss was approximately
$32,734. The Government’s computation of Mr. Del Bosque’s
understated income in the criminal tax proceeding was derived
from Agent Fisher’s computations using the net worth method.
In his criminal tax proceeding, Mr. Jacobsen expressly
admitted that he omitted substantial income from his 1987 and
1988 returns with the intent to evade taxes. For purposes of the
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