Clarence J. Reherman and Helen S. Reherman, Petitioners, v. Commissioner of Internal Revenue, Respondent, 240 F.2d 953 (6th Cir. 1957)

Annotate this Case
US Court of Appeals for the Sixth Circuit - 240 F.2d 953 (6th Cir. 1957) January 2, 1957

Earnest Woodward, II, Woodward, Hobson & Fulton, Louisville, Ky., for petitioner.

Charles K. Rice, John Potts Barnes, Lee A. Jackson, Dickinson Thatcher, Rollin H. Transue, Robert Anderson and George F. Lynch, Washington, D. C., for respondent.

Before MARTIN, MILLER and STEWART, Circuit Judges.


Petitioners, husband and wife, during the years 1941 through 1946 were residents of Hardinsburg, Kentucky, where the husband was a successful dentist. They filed joint income tax returns for those years in which they reported approximately $15,000 of income. It is conceded that their actual income during that period was over $60,000.

The Tax Court found that at least part of the deficiency for each of the years in question was due to fraud with intent to evade tax and sustained the imposition of fifty per cent fraud penalties pursuant to Section 293(b) of the Internal Revenue Code of 1939. 26 U.S.C.A. § 293(b). Petitioners contend that this finding was clearly erroneous because it was based solely upon the admitted understatements of income.

It is true that a taxpayer's admission of a deficiency does not, standing alone, sustain the Commissioner's burden of proving fraud. However, in view of other evidence in the record, it cannot be said in this case that the Tax Court's finding that the Commissioner had sustained his burden of proof was clearly erroneous. Drieborg v. Commissioner, 6 Cir., 1955, 225 F.2d 216.

The decision of the Tax Court is accordingly affirmed.