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2001, petitioner received and cashed 13 checks from Golden Leaf.
The checks totaled $85,097.
During 2001, respondent received a Form W-2, Wage and Tax
Statement, from Labor Ready Central III LP reporting that $52 in
wages was paid to petitioner. Respondent also received a Form
1099-MISC, Miscellaneous Income, from Metroplex Design Builders
reporting that $1,450 in nonemployee compensation had been paid
to petitioner during 2001.
Respondent issued a notice of deficiency for 2001
determining that petitioners had unreported income of $52,697
from services rendered, and determining an accuracy-related
penalty under section 6662(a) of $3,082.
Discussion
Generally, the Commissioner's determinations of unreported
income in a notice of deficiency are presumed correct, and the
taxpayer has the burden of proving that those determinations are
erroneous. See Rule 142(a); Welch v. Helvering, 290 U.S. 111,
115 (1933). In some cases the burden of proof with respect to
relevant factual issues may shift to the Commissioner under
section 7491(a). Petitioners did not present evidence or
argument that they satisfied the requirements of section 7491(a),
and, therefore, the burden of proof does not shift to respondent.
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Last modified: May 25, 2011