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underpayment which the taxpayer establishes is not attributable
to fraud. Secs. 6653(b)(2), 6663(b).
A. Underpayment
The Commissioner has the burden of proving by clear and
convincing evidence that an underpayment exists in each of the
years in issue. The Commissioner is not required to prove the
exact amount of the underpayment. DiLeo v. Commissioner, 96 T.C.
at 873. On the other hand, the Commissioner does not satisfy his
burden of proof by merely relying on the taxpayer’s failure to
prove error in the determination. Id. On the basis of the
evidence presented and our analysis supra, we find that
respondent has clearly and convincingly established that
petitioner had underpayments of tax in 1988, 1989, and 1990.
B. Underpayment Due to Fraud
Fraud has been defined as an “intentional wrongdoing on the
part of a taxpayer motivated by a specific purpose to evade a tax
known or believed to be owing.” Stoltzfus v. United States, 398
F.2d 1002, 1004 (3d Cir. 1968); see also Langworthy v.
Commissioner, T.C. Memo. 1998-218. Courts consider a taxpayer’s
entire course of conduct in determining fraudulent intent. DiLeo
v. Commissioner, supra at 874; Petzoldt v. Commissioner, 92 T.C.
661, 699 (1989). Because direct evidence is rarely available,
fraud may be proven by circumstantial evidence. DiLeo v.
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