Carmelo Montalbano - Page 7

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         been applicable in the absence of petitioner’s ‘substantially                
         diminished mental capacity.’”                                                
              Assuming, for sake of argument, that petitioner has                     
         correctly assessed the implications of his criminal sentence                 
         (notwithstanding that the District Court imposed against him the             
         maximum fine for his offense under the sentencing guidelines),               
         this does not alter the fact of his criminal conviction, which               
         conclusively established that he willfully attempted to evade                
              For purposes of both the section 7201 offense and the civil             
         fraud penalty, the requisite wrongful intent is the intent to                
         evade tax.  Mitchell v. Commissioner, 118 F.2d 308 (5th Cir.                 
         1941), revg. 40 B.T.A. 424 (1939); DiLeo v. Commissioner, 96 T.C             
         at 874; Amos v. Commissioner, 43 T.C. at 55.3  The only practical            
         difference between the constituent elements of criminal tax                  
         evasion under section 7201 and civil fraud is the “larger quantum            
         of proof required in a criminal evasion case”.  Moore v. United              

               3 The statutory predecessor of sec. 6663, sec. 293(b) of the           
          1939 Internal Revenue Code, specifically referred to “fraud with            
          intent to evade tax”.  Although this language was omitted from              
          subsequent versions of the civil fraud penalty, this change was             
          not intended to alter the coverage of the statute or the burden             
          of proof necessary to establish fraud.  See Goodwin v.                      
          Commissioner, 73 T.C. 215, 227 (1979); Bittker & Lokken, Federal            
          Taxation of Income, Estates and Gifts, par. 114.6, at 114-57 n.16           
          (2d ed. 1992).  This conclusion is buttressed by sec. 7454(a),              
          which continues to provide, as did its predecessor statute in the           
          1939 Code, that respondent bears the burden to prove that                   
          petitioner “has been guilty of fraud with intent to evade tax”.             

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