- 5 -
beginning of the tax year. Petzoldt v. Commissioner, supra at
695; Burgo v. Commissioner, supra at 743.
At one time, petitioner asserted that the unreported income
represents nontaxable loans or gifts from his mother in the
approximate amounts of $7,000 and $49,000 for the 1996 and 1997
taxable years, respectively, and $4,000 from his aunt.4 At
trial, however, he did not testify as to any specific amounts
that he received. As discussed, according to petitioner, his
mother and aunt sold capital assets and gave the proceeds to him
in the form of either cash or cashier’s checks, and he used these
funds to pay his personal expenses. Petitioner, however, did not
provide any documentation to substantiate these purported loans
or gifts. The record is devoid of any loan agreements; Form
1099-B, Proceeds from Broker and Barter Exchange Transactions,
relating to his mother’s or aunt’s sale of capital assets; or the
alleged cashier’s checks. See Wynn v. Commissioner, T.C. Memo.
1996-415. Additionally, upon examination of respondent’s
financial information concerning petitioner’s mother and aunt for
1995, 1996, and 1997, it does not appear that either had the
financial capability to make such large loans or gifts to
petitioner.5 See Holland v. United States, 348 U.S. 121, 135-137
4 We note that except for 1997, even if these amounts are
correct, there still are substantial understatements of income.
5 From respondent’s summary of records, it appears that
(continued...)
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