Diana Cote - Page 4

          At calendar call, petitioner did not appear, but the Court had              
          before it and granted petitioner’s motion for a trial time and              
          date certain.  At trial, petitioner did not personally appear but           
          was represented by counsel.  Petitioner’s counsel did not                   
          introduce any evidence on petitioner’s behalf at trial and failed           
          to file a posttrial brief following the trial.                              
          1.   Unreported Income                                                      
               As a general rule, the Commissioner’s determinations set               
          forth in a notice of deficiency are presumed correct, and the               
          taxpayer bears the burden of showing that these determinations              
          are in error.  Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115           
          (1933).3  In order for the presumption of correctness to attach             
          to the deficiency determination in unreported income cases, the             
          Commissioner must establish “some evidentiary foundation”                   
          connecting the taxpayer with the income-producing activity,                 
          Weimerskirch v. Commissioner, 596 F.2d 358, 361-362 (9th Cir.               
          1979), revg. 67 T.C. 672 (1977), or demonstrate that the taxpayer           
          received unreported income, Edwards v. Commissioner, 680 F.2d               
          1268, 1270 (9th Cir. 1982) (Commissioner’s assertion of a                   

               3  Pursuant to sec. 7491(a), the burden of proof as to                 
          factual matters shifts to respondent under certain circumstances.           
          Petitioner has neither alleged that sec. 7491 applies nor                   
          established her compliance with the requirements of sec.                    
          7491(a)(2)(A) and (B) to substantiate items, maintain records,              
          and cooperate fully with respondent’s reasonable requests.                  
          Petitioner therefore bears the burden of proof.                             

Page:  Previous  1  2  3  4  5  6  7  8  9  Next

Last modified: May 25, 2011