Alan D. Stang - Page 14

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          Government had already alleged that Mr. Nipper engaged in                   
          fraudulent conveyances to conceal income and assets, further                
          concluded as a factual matter that Mr. Nipper had shown more than           
          “just a fanciful possibility of prosecution”.  Id. at 1262.                 
          Here, respondent has repeatedly affirmed that no criminal                   
          investigation is pending with respect to petitioner and has never           
          asserted fraud on petitioner’s part.  The Court remains convinced           
          that petitioner has established no real and reasonable fear of              
          incrimination and that Rule 91(f) was properly applied                      
          notwithstanding his Fifth Amendment objections.                             
          III.  Unreported Income                                                     
               The Internal Revenue Code imposes a Federal tax on the                 
          taxable income of every individual.  Sec. 1.  Section 61(a)                 
          defines gross income for purposes of calculating taxable income             
          as “all income from whatever source derived”.  This broad                   
          definition encompasses “Compensation for services, including                
          fees, commissions, fringe benefits, and similar items”.  Sec.               
          61(a)(1); see also sec. 1.61-2(a)(1), Income Tax Regs.                      
          Respondent has determined that petitioner received unreported               
          wages and nonemployee compensation from GCE.                                
               As a general rule, the Commmissioner’s determinations are              
          presumed correct, and the taxpayer bears the burden of proving              
          error therein.  Rule 142(a); Welch v. Helvering, 290 U.S. 111,              
          115 (1933).  Although section 7491(a) may shift the burden to the           






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