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OPINION
Individuals whose gross income exceeds certain levels for a
taxable year are required to file an income tax return. Sec.
6012(a). If an individual fails to file an income tax return,
the Commissioner may impose an addition to tax of up to 5 percent
per month of the amount required to be shown, up to a maximum of
25 percent. Sec. 6651(a)(1). If the failure to file is
fraudulent, the addition to tax is 15 percent per month of the
amount required to be shown up to a maximum of 75 percent. Sec.
6651(f).
Petitioner stipulated that he did not file a timely income
tax return for 1995. We must determine whether his failure to
file timely was fraudulent within the meaning of section 6651(f).
In determining whether a taxpayer’s failure to file is
fraudulent, we consider the same elements that are considered in
imposing the fraud penalty under section 6663. Clayton v.
Commissioner, 102 T.C. 632, 653 (1994). Fraud is an intentional
wrongdoing designed to evade tax known or believed to be owing.
Edelson v. Commissioner, 829 F.2d 828, 833 (9th Cir. 1987), affg.
T.C. Memo. 1986-223; Bradford v. Commissioner, 796 F.2d 303, 307
(9th Cir. 1986), affg. T.C. Memo. 1984-601. Respondent has the
burden of proving fraud by clear and convincing evidence. Sec.
7454(a); Rule 142(b); Clayton v. Commissioner, supra.
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Last modified: May 25, 2011