¶2MEMORANDUM FINDINGS OF FACT AND OPINION
¶3SWIFT, Judge: In these consolidated cases, respondent determined deficiencies in petitioner's Federal income taxes and additions to tax as follows:
¶4 Additions to Tax
¶5 Year Deficiency Sec. 6651(f)Sec. 6654
¶6 ____ __________ _________________________
¶7 1993 $ 192,457 $ 144,343 $ 8,064
¶8 1994 181,722 136,291 9,430
¶9 1995 122,177 91,633 6,625
¶10Unless otherwise indicated, all section references are to the Internal Revenue Code in effect for the years in issue, and all Rule references are to the Tax Court Rules of Practice and Procedure.
¶11The issues for decision involve the amount of unreported income that should be charged to petitioner, petitioner's liability under section 6651(f) for fraudulent failure to file income tax returns, and petitioner's liability under section 6654 for failure to*126 make estimated income tax payments.
¶12FINDINGS OF FACT
¶13Because petitioner failed to respond to respondent's requests for admission, factual matter set forth in respondent's requests for admission is deemed admitted. See Rule 90(c).
¶14When the petition was filed, petitioner resided in Greenwell Springs, Louisiana. Petitioner and his stepdaughter and her husband, Rebecca and Richard Adair, operate a roofing business under the name H & H Sheet Metal (the roofing business). The evidence does not establish how ownership of the roofing business is divided between petitioner and the Adairs.
¶15Payments were received by the roofing business for roofing services rendered for various general contractors, including Roof Technologies and Vaughn Roofing.
¶16In 1993, 1994, and 1995, Roof Technologies and Vaughn Roofing were billed by the roofing business the following total amounts for roofing services rendered to them:
¶17 Year Amount
¶18 ____ _______
¶19 1993 $ 490,009
¶20 1994 426,843
¶22Roof Technologies and Vaughn Roofing issued checks in favor of petitioner that cumulatively total the above amounts billed to them by the roofing business. The checks were received and deposited into a checking account (the checking account) on which petitioner, petitioner's wife, and Rebecca Adair were signatories.
¶23For 1993, 1994, and 1995, the following schedule reflects monthly and annual total deposits into the above checking account:
¶24 Month Total Deposits Into Checking Account
¶25 1993 1994 1995
¶26 ___________________________________________________
¶27 January -0- $ 21,346 $ 10,533
¶28 February $ 28,154 34,950 19,056
¶29 March 25,824 12,150 23,104
¶30 April 37,400 53,022 18,000
¶31 May 20,131 44,211 21,372
¶32 June 48,870 55,007 61,050
¶33*128 July 34,149 37,700 49,146
¶34 August 33,038 17,577 670
¶35 September 52,000 53,619 24,465
¶36 October 91,020 51,219 51,946
¶37 November 72,000 56,580 17,492
¶38 December 65,150 40,450 34,500
¶39 ________ ________ ________
¶40 Total $ 507,736 $ 477,903 $ 331,334
¶41For 1993, 1994, and 1995, petitioner did not file Federal income tax returns.
¶42During respondent's audit, petitioner did not cooperate with respondent's agents, and petitioner did not provide to respondent's agents the books and records relating to the roofing business. Also, petitioner mailed to respondent letters reflecting frivolous tax protester arguments.
¶43On audit and in the notices of deficiency for the years in issue, using the bank deposits method of proof and the specific item method of proof for interest income earned on the checking account balance, *129 respondent determined that petitioner received unreported taxable income in the following total amounts:
¶44 Year Amount
¶45 ____ ________
¶46 1993 $ 517,236
¶47 1994 477,903
¶48 1995 333,780
¶49Because of lack of documentation provided during the audit, respondent did not allow petitioner any deductions for expenses relating to the roofing business, and respondent charged petitioner with the above total amounts for each year as unreported taxable income.
¶50For each year, respondent also determined that petitioner was liable for the fraudulent failure to file addition to tax under section 6651(f). In the alternative, for each year, respondent determined that petitioner was liable for the negligent failure to file addition to tax under section 6651(a)(1).
¶51As a protective measure, on audit of Rebecca and Richard Adair for 1993, 1994, and 1995, respondent charged to the Adairs the same total amounts of unreported income relating to the bank deposits that were charged to petitioner.
¶52OPINION
¶53*130Under section 61, gross income includes all income from whatever source derived. See Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431, 99 L. Ed. 483, 75 S. Ct. 473 (1955). Taxpayers are required to maintain sufficient records to allow respondent to determine their correct Federal income tax liability. See sec. 6001. Taxpayers with income above the exemption amount are required to file Federal income tax returns. See sec. 6012.
¶54Generally, respondent's determinations are presumed correct, and taxpayers have the burden of proving that respondent's determinations are erroneous. See Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115, 78 L. Ed. 212, 54 S. Ct. 8 (1933).
¶55Generally, bank deposits are treated as prima facie evidence of taxable income. See Woodall v. Commissioner, 964 F.2d 361, 364 (5th Cir. 1992), affg. T.C. Memo. 1991-15; Parks v. Commissioner, 94 T.C. 654, 658 (1990); Tokarski v. Commissioner, 87 T.C. 74, 77 (1986).
¶56Where taxpayers fail to present evidence regarding the proper division between them of income received from a jointly operated business, respondent and the courts may approximate the amount of income to be charged to each taxpayer. *131 See Arouth v. Commissioner, T.C. Memo 1992-679. An equal division of income may be appropriate where taxpayers fail to provide any evidence of a more appropriate division of the income. See Cannon v. Commissioner, 533 F.2d 959, 960 (5th Cir. 1976), affg. Ash v. Commissioner, T.C. Memo 1974-219; Puppe v. Commissioner, T.C. Memo 1988-311.
¶57Where evidence exists that taxpayers incurred expenses relating to their business, it may be appropriate to allow an estimate of the business expenses. See Cohan v. Commissioner, 39 F.2d 540, 543-544 (2d Cir. 1930); Vanicek v. Commissioner, 85 T.C. 731, 743 (1985); Sherrer v. Commissioner, T.C. Memo 1999-122.
¶58For 1993, 1994, and 1995, IRS Publication 1136, Statistics of Income Bulletin, reflected the following average net profit margin for roofing contractors:
¶59 Average
¶60 Net Profit
¶61 Year Margin
¶62 ____ __________
¶63 1993 20%
¶65 1995 18%
¶66As indicated, respondent's tax deficiencies against petitioner are based on deposits to the checking account with no allowance for labor and material costs which obviously were incurred in the roofing business. We conclude that for each year it is appropriate to apply to the checking account deposits that are specifically identifiable as gross receipts of the roofing business (namely, those deposits that represent the checks received from Roof Technologies and Vaughn Roofing) the average net profit margin established by respondent for roofing contractors and to allow estimated business expense deductions for the business expenses so calculated.
¶67Petitioner has presented no evidence as to how income from the roofing business should be divided between himself and Rebecca and Richard Adair. We conclude that one-half of the income determined under the bank deposits method of proof is taxable to petitioner.
¶68In the related case of Adair v. Commissioner, T.C. Memo 2000-110, docket Nos. 12103-97 and 20465-97, also filed this date, we charge the Adairs with the other*133 half of the income of the roofing business relating to deposits into the checking account.
¶69For each year in issue, our calculations of petitioner's taxable income are set forth below. The bank deposits that are identified as gross receipts of the roofing business are multiplied by the average net profit margin for roofing contractors, producing a partial taxable income figure for the roofing business. Added to this partial net income figure are the unidentified bank deposits to calculate total taxable income relating to the deposits to the checking account, one-half of which is then charged to petitioner.
¶70 Bank
¶71 Deposits Net Income
¶72 Identified of Roofing
¶73 as Gross Average Business on Unidenti-
¶74 Receipts Net Identified fied One-half
¶75 of Roofing Profit Bank Bank Taxable Charged to
¶76Year Business Margin Deposits Deposits Income(*) Petitioner
¶771993 $ 490,009 20% $ 98,002 $ 17,727 $ 115,875 $ 57,938
¶781994 426,843 25% 106,711 51,061 157,939 78,970
¶791995 197,965 18% *134 35,634 133,369 169,032 84,516
¶80 (*) As indicated, also included in the taxable income for each
¶81year is interest income relating to the checking account in the
¶82respective amounts of $ 146, $ 167, and $ 29.
¶83Under section 6651(f), an addition to tax of up to 75 percent applies where the failure to file a Federal income tax return is due to fraudulent conduct. See DiLeo v. Commissioner, 959 F.2d 16 (2d Cir. 1992), affg. 96 T.C. 858, 873 (1991). Respondent has the burden of proving fraud by clear and convincing evidence. See sec. 7454(a); Rule 142(b); Bagby v. Commissioner, 102 T.C. 596, 607 (1994).
¶84Indicia of fraud include: (1) Understatements of income; (2) inadequate books and records; (3) failure to file tax returns; (4) implausible or inconsistent explanations; and (5) lack of cooperation with tax authorities. See Bradford v. Commissioner, 796 F.2d 303, 307-308 (9th Cir. 1986), affg. T.C. Memo. 1984-601; Clayton v. Commissioner, 102 T.C. 632, 647 (1994); Petzoldt v. Commissioner, 92 T.C. 661, 699-700 (1989); Recklitis v. Commissioner, 91 T.C. 874, 910 (1988).*135
¶85Petitioner has not alleged any nontaxable sources of income, and the roofing business constitutes the likely taxable source of the deposits into the checking account.
¶86With regard to fraudulent intent, the evidence establishes for each year in issue that petitioner realized significant income that he failed to report, that petitioner failed to provide to respondent's agents books and records relating to the roofing business, that petitioner failed to file income tax returns, that petitioner failed to pay significant tax liabilities that he owed, that petitioner did not cooperate with respondent, and that petitioner made erroneous tax protester objections to the tax laws. The evidence establishes that petitioner fraudulently failed to file his Federal income tax returns for 1993, 1994, and 1995.
¶87Section 6654(a) provides for an addition to tax for failure to make timely estimated income tax payments. Petitioner has not proven that an exception applies, and for each year in issue, petitioner is liable for the section 6654 addition to tax.
¶88To reflect the foregoing,