Fill and Sign the Jury Instruction Bank Deposits Method Form

81.3 Bank Deposits Method In this case the Government relies upon the so-called " bank deposits method" of proving unreported income. This method of proof proceeds on the theory that if a taxpayer is engaged in an income producing business or occupation and periodically deposits money in bank accounts in the taxpayer's name or under the taxpayer's control, an inference arises that such bank deposits represent taxable income unless it appears that the deposits represented re-deposits or transfers of funds between accounts, or that the deposits came from non-taxable sources such as gifts, inheritances or loans. This theory also contemplates that any expenditures by the Defendant of cash or currency from funds not deposited in any bank and not derived from a non-taxable source, similarly raises an inference that such cash or currency represents taxable income. Because the " bank deposits method" of proving unreported income involves a review of the Defendant's deposits and cash expenditures that came from taxable sources, the Government must establish an accurate cash-on-hand figure for the beginning of the tax year. The proof need not show the exact amount of the beginning cash-on-hand so long as it is established that the Government's claimed cash-on-hand figure is reasonably accurate. So, if you should decide that the evidence does not establish with reasonable certainty what the Defendant's cash-on-hand was at the beginning of the year, you should find the Defendant not guilty. In determining whether or not the claimed cash-on-hand of the Defendant at the starting point (or the beginning of the year) is reasonably accurate, you may consider whether Government agents sufficiently investigated all reasonable " leads" suggested to them by the Defendant, or which otherwise surfaced during the investigation, concerning the existence of other funds at that time. If you should find that the Government's investigation has either failed to reasonably pursue, or to refute, plausible explanations which were advanced by the Defendant, or which otherwise arose during the investigation, concerning the Defendant's cash-on-hand at the beginning of the year, then you should find the Defendant not guilty. Notice, however, that this duty to reasonably investigate applies only to suggestions or explanations made by the Defendant, or to reasonable leads that otherwise turn up; the Government is not required to investigate every conceivable source of non-taxable funds. If you decide that the evidence in the case establishes beyond a reasonable doubt that the Defendant's bank deposits together with non-deductible cash expenditures during the year did substantially exceed the amount of income reported on the Defendant's tax return for that year, you should then proceed to decide whether the evidence also establishes beyond a reasonable doubt that such additional deposits and expenditures represented taxable income (that is, income from taxable sources) on which the Defendant willfully attempted to evade and defeat the tax as charged in the indictment.