- 14 -
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
Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 NextLast modified: May 25, 2011