- 34 - Mr. Black attempted to conceal assets by placing title to the assets in his wife’s name. At trial, Mr. Black testified that he placed title to property solely in his wife’s name so that his creditors would not be able to reach it. Finally, petitioners provided implausible or inconsistent explanations to explain the discrepancy in the net worth calculations; namely, that they had a cash hoard of $500,000. As discussed above, we do not find any of the testimony presented regarding the cash hoard to be credible. C. Conclusion We conclude that the record shows by clear and convincing evidence that petitioners understated their income and overstated deductions and that there are sufficient badges of fraud to show that understated income and overstated deductions are due to Mr. Black’s fraudulent intent. Petitioners have failed to prove any portion of the underpayment is not attributable to fraud. Accordingly, we hold that section 6501(a) does not bar the assessment and collection of taxes for 1991 and 1992 and that Mr. Black is liable for the fraud penalty pursuant to section 6663. 2. Amount of the Deficiency Although petitioners conceded some unreported gross income, petitioners did not concede the deficiencies determined by respondent. Petitioners contend they are entitled to a number of adjustments to gross income not allowed by respondent.Page: Previous 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 NextLast modified: March 27, 2008