- 6 - E. The Present Litigation On March 22, 2004, petitioners timely filed a petition with this Court seeking review of the notice of deficiency and alleging that they had expense documentation that would reduce the amount of the deficiency. On April 27, 2004, respondent’s answer was filed. The trial in this case was set for the Court’s January 24, 2005, Los Angeles, California, trial session, and both parties appeared and were heard. OPINION Section 61(a) defines gross income for purposes of calculating taxable income as “all income from whatever source derived”. Respondent has determined that petitioners received unreported income from Life Bank, Alpa, Geylikman, Svetella, and the Los Angeles County Auditor Controller. The Commissioner’s deficiency determination is normally entitled to a presumption of correctness, Rapp v. Commissioner, 774 F.2d 932, 935 (9th Cir. 1985), and the burden of proving the determination incorrect generally rests with the taxpayer, Rule 142(a). However, when a case involves unreported income and that case is appealable to the Court of Appeals for the Ninth Circuit, barring a stipulation to the contrary, the Commissioner’s determination of unreported income is entitled to the presumption of correctness only if the determination is supported by some evidence linking the taxpayer to an income-producing activity.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: May 25, 2011