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with respect to the accuracy-related penalties under section
6662(a).
2. Factual Issues
Pursuant to the general rule of section 7491(a)(1), if the
taxpayer introduces credible evidence with respect to any factual
issue relevant to ascertaining the taxpayer’s liability for income
tax, the Commissioner bears the burden of proof with respect to
that issue. The preceding rule applies, however, only if the
taxpayer has: (1) Complied with requirements under the Internal
Revenue Code to substantiate any item; (2) maintained all records
required by the Internal Revenue Code; and (3) cooperated with
reasonable requests by the Secretary for information, documents,
and meetings. Sec. 7491(a)(2). Taxpayers bear the burden of
proving that these requirements have been met. Snyder v.
Commissioner, T.C. Memo. 2001-255 (citing H. Conf. Rept. 105-599,
at 240-241 (1998), 1998-3 C.B. 747, 994-995).
Respondent contends that the burden of proof remains on
petitioners with respect to all factual issues in this case because
petitioners failed to comply with the substantiation requirements,
failed to maintain all records required by the Internal Revenue
Code, and failed to cooperate with reasonable requests for
information and documents.
In this case, there are multiple factual issues relevant to
determining petitioners’ tax liabilities. We will define those
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