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corporation) may claim losses on the sale or exchange of capital
assets to the extent of the lesser of $3,000 ($1,500 if married
filing separately) or the excess of such capital losses over
capital gains. Sec. 1211(b).
Once more, in what is becoming a familiar refrain, the
record is devoid of evidence on this matter. The Court therefore
sustains respondent’s determinations.
IV. Section 6663 Fraud Penalties
Section 6663(a) provides for the imposition of a penalty in
“an amount equal to 75 percent of the portion of the underpayment
which is attributable to fraud.” In addition, section 6663(b)
specifies that, if any portion of the underpayment is
attributable to fraud, the entire underpayment is treated as
attributable thereto, except and to the extent that the taxpayer
establishes some part is not due to fraud.
Respondent bears the burden of proving the applicability of
the civil fraud penalty by clear and convincing evidence. Sec.
7454(a); Rule 142(b). To sustain this burden, respondent must
establish by this level of proof both (1) that there was an
underpayment of tax for each taxable year in issue and (2) that
at least some portion of such underpayment was due to fraud.
DiLeo v. Commissioner, 96 T.C. 858, 873 (1991), affd. 959 F.2d 16
(2d Cir. 1992); Petzoldt v. Commissioner, 92 T.C. 661, 699
(1989).
A. Underpayments of Tax
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