Andrew S. Cirbo - Page 5

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               Immediately thereafter, NACOLAH issued two checks totaling             
          $35,061.76, dated March 12 and 13, 2003, made payable to                    
          petitioner for commissions earned.  The checks were sent to                 
          Investments’ business address and were deposited by Donlon into             
          an account maintained by Investments.  Investments subsequently             
          paid the taxes on the commissions.                                          
               Petitioner filed a 2003 Form 1040, U.S. Individual Income              
          Tax Return, reporting wages of $7,194, unemployment compensation            
          of $7,610, taxable refunds of $401, and adjusted gross income of            
          $15,205.  Respondent received from NACOLAH a Form 1099-MISC,                
          Miscellaneous Income, reporting that commissions of $35,061 were            
          paid to petitioner in 2003.  On November 7, 2005, respondent                
          issued to petitioner a statutory notice of deficiency determining           
          that petitioner had unreported income of $35,061 in 2003.                   
               The Commissioner’s determinations are presumed correct, and            
          generally taxpayers bear the burden of proving otherwise.  Rule             
          142(a)(1); Welch v. Helvering, 290 U.S. 111, 115 (1933).                    
               Under section 6201(d), the burden of production may shift to           
          the Commissioner where an information return, such as a Form                
          1099, serves as the basis for the determination of a deficiency.            
          If a taxpayer asserts a reasonable dispute with respect to any              
          item of income reported on a third-party information return and             

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