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deductions claimed on his 2001 returns. Respondent clearly and
convincingly proved that a substantial number of documents
attached by petitioner to his 2001 return in an effort to
convince respondent that his deductions were proper had been
forged and falsified. Respondent also proved that petitioner
submitted at least one other forged document during the pendency
of this case. That document conflicted with another forged
document that petitioner had attached to his 2001 return.
Respondent elicited testimony at trial establishing that
petitioner admitted preparing at least some of the forged
documents. The totality of the evidence clearly and convincingly
establishes that petitioner deliberately overstated his
deductions for 2001 and falsified documents supporting the
overstated and unsubstantiated deductions to mislead respondent
and to evade his proper income tax liability for 2001.
Respondent has met his burden of proving that petitioner is
liable for the fraud penalty, and, consequently, we sustain
respondent’s determination.
Decision will be entered under
Rule 155.
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