What is the test for establishing taxable income using the net worth method?

To establish taxable income using the net worth method, the government must (1) accurately establish the taxpayer's opening net worth, (2) identify a likely source of taxable income from which it may be inferred that the taxpayer's increase in net worth arose, and (3) conduct a reasonable investigation of any leads that suggest the taxpayer properly reported his income. E.g., United States v. Greene, 698 F.2d 1364, 1370 (9th Cir.1983). "Once the Commissioner has introduced some evidence that a taxpayer received unreported income, the burden shifts to the taxpayer to prove by a preponderance of the evidence that the deficiency determination is arbitrary or excessive." Edelson v. Commissioner, 829 F.2d 828, 831 (9th Cir.1987).