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years 1994, 1995, and 1996, Mr. Clinkscale (1) engaged in a
criminal enterprise to distribute cocaine from which he earned
substantial income; (2) conducted financial activities in cur-
rency (i.e., cash) with the intent to evade tax; (3) structured
various financial activities in an attempt to avoid Federal
reporting requirements with the intent to evade tax; and
(4) failed to maintain complete and adequate books and accounts
of income-producing activities as required by applicable provi-
sions of the Code and the regulations thereunder. The record
also establishes that, for each of the taxable years 1994, 1995,
and 1996, Mr. Clinkscale provided incomplete and/or erroneous
information to tax return preparers and fraudulently, with the
intent to evade tax, filed a tax return that substantially
understated adjusted gross income and tax.
On the instant record, we find that respondent has estab-
lished by clear and convincing evidence that Mr. Clinkscale
intended to evade tax for each of the taxable years 1994, 1995,
and 1996, which Mr. Clinkscale believed to be owing, by conduct
intended to conceal, mislead, or otherwise prevent the collection
of such tax.
On the record before us, we sustain respondent’s determina-
tions that Mr. Clinkscale is liable for the fraud penalty under
section 6663(a) for each of the taxable years 1994, 1995, and
1996.
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