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Subject:  Re: The Cost Basis Crisis Date:  7/3/2006  3:37 PM
Author:  Wradical Number:  87653 of 128111

(Me:)In both cases [civil and criminal], the burden of proof is on the party with the evidence to support its assertions.

(Eric:) No. In the criminal case, the burden of proof rests solely on the government. The defense need make no defense whatsoever beyond merely denying the charges.

Well, that's what I meant. In a criminal case, the government has the burdern of proof because it, and only it, has to produce the evidence to support its assertions - of the guilt of the accused.

Our tax reporting system is based on self-reporting. In a tax audit, the taxpayer, who filled out his own return, with numbers that may look funny, has the burden of proving the accuracy of those numbers - which isn't unreasonable, as he has already sworn that, "to the best of my knowledge [the return] is true, correct, and complete."

In the case I referred to earlier:
It was an amended return [that resulted in a no-change letter], with some odd circumstances, that was practically asking for it.

Eric: This is the part, the "practically asking for it," in the whole thread that bothers me. You didn't intend this meaning, but this implies that, to keep the government from intruding too far, we have to hew very close to the norm. No differing behaviors allowed.

Your mind-reading ability is slipping. Believe it or not, I am capable of writing exactly what I mean. We were practically begging for an audit because we filed an amended return, for a very large refund, for a strange-sounding reason - which happened to be true. I would say the IRS was certainly justified in inquiring into this one.

And what do you mean "keep the IRS from intruding too far?" They have the right, and in some cases, like this, the duty - to audit a return.


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