In that case, the defendant was convicted of five counts of tax evasion. The Government used the net worth method of proof. The net worth method requires that the Government prove opening and closing net worth and then account for the difference in the intervening accounting periods. Unlike, in civil cases, though, this accounting does not need to be a precise exercise because, for tax evasion, all the Government need show is some -- perhaps some substantial -- tax evaded without any need for establishing a precise or even an estimated amount of the total tax evaded. And the Government must also show some likely source of taxable income or at least negate nontaxable income. Even though this is a nonprecedential decision, I wonder whether the readers think this is an odd paragraph (case citations omitted):
The District Court explained that the Government could choose to prove unreported income circumstantially either by (1) negating all possible non-taxable sources of income or (2) showing a likely source of unreported income. If the Government chooses the first method, there is no further obligation to prove a likely source of taxable income. We agree with the [District] Court that the Government produced sufficient evidence such that the jury could find, beyond a reasonable doubt, that "all nontaxable sources of income of which it was made aware" were negated.Are the bold face statements the same? Is there a burden on the Government, independent of leads from the taxpayer, to negate possible non-taxable sources of income? Can the Government just claim that it is not aware of any nontaxable sources and rest?
Ok, it is a slow news day!