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Respondent’s bank deposits analyses concluded that petitioners
had unexplained bank deposits as follows:
1997 1998 1999
Total deposits $1,087,054 $270,366 $191,576
Nontaxable items (371,000) (138,612) (43,902)
Reported amounts (648,570) (92,117) (117,070)
Unexplained deposits1 67,484 39,637 30,604
1 The parties do not explain the difference
between the amounts of unexplained deposits and the
amounts of the total unreported income set forth in the
notices of deficiency.
OPINION
A. Burden of Proof
Section 7491(a) was added to the Internal Revenue Code by
the Internal Revenue Service Restructuring and Reform Act of
1998, Pub. L. 105-206, sec. 3001(c), 112 Stat. 727, effective for
court proceedings arising from examinations commencing after
July 22, 1998. While the burden of proof in this Court is
usually on a petitioning taxpayer, see Rule 142(a)(1), section
7491(a)(1) provides that the burden of proof on certain issues
affecting the liability of a taxpayer for tax shifts to the
Commissioner in specified circumstances. We hold that section
7491(a) does not apply to either issue before us because, we
find, petitioners have not proven that they complied with the
requirements of section 7491(a)(2)(B) to cooperate fully with
respondent’s reasonable requests for witnesses, information,
documents, meetings, and interviews. See also Weaver v.
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