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Court for the years at issue in this case. That testimony was
corroborated by persons who maintained the books and records,
including billings for services rendered. At trial, petitioner
admitted to fabricating a receipt for his 2002 return by reusing
a doctor’s form that had been used for his 2001 tax return. In
an attempt to mislead respondent and the Court, petitioner went
to great lengths to provide a variety of implausible and
unconvincing arguments regarding the receipts at issue.
The totality of the evidence clearly and convincingly
establishes to the Court’s satisfaction that petitioner
deliberately overstated his deductions for 2002 and 2003 and
falsified documents supporting the overstated and unsubstantiated
deductions to mislead respondent and to evade his proper income
tax liability for 2002 and 2003.
Respondent determined that petitioner’s actions constituted
fraud, and the Court sustains that determination. Therefore,
petitioner is liable for the section 6663(a) penalties for 2002
and 2003.7
Section 6651 Addition to Tax
Section 6651(a)(1) provides for an addition to tax for
failure to file timely Federal income tax returns unless the
taxpayer shows that such failure was due to reasonable cause and
7 Accordingly, there is no need to address respondent’s
alternative argument that petitioner is liable for the accuracy-
related penalty under sec. 6662(a) for both years.
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