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Cir. 1975). The existence of fraud is a question of fact to be
resolved from the entire record. Gajewski v. Commissioner, 67
T.C. 181, 199 (1976), affd. without published opinion 578 F.2d
1383 (8th Cir. 1978).
However, fraud need not be established by direct evidence,
which is rarely available, but may be proved by surveying the
taxpayer’s entire course of conduct and drawing reasonable
inferences therefrom. Spies v. United States, 317 U.S. 492, 499
(1943). Courts have relied on a number of indicia or badges of
fraud in deciding whether to sustain the Commissioner’s
determinations with respect to the additions to tax for fraud.
Although no single factor may be necessarily sufficient to
establish fraud, the existence of several indicia may be
persuasive circumstantial evidence of fraud. Solomon v.
Commissioner, 732 F.2d 1459, 1461 (6th Cir. 1984), affg. per
curiam T.C. Memo. 1982-603; Beaver v. Commissioner, 55 T.C. 85,
93 (1970).
Circumstantial evidence that may give rise to a finding of
fraudulent intent includes: Understatement of income, inadequate
records, failure to file tax returns, concealment of assets,
failure to cooperate with tax authorities, filing false
documents, failure to make estimated tax payments, engaging in
illegal activity, attempting to conceal illegal activity, dealing
in cash, implausible or inconsistent explanations of behavior, an
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