Greta Ann Clifton - Page 24

                                       - 24 -                                         
          T.C. 934, 947 (1985) (quoting Marcello v. Commissioner, 380 F.2d            
          499, 506 (5th Cir. 1967), affg. in part and remanding in part 43            
          T.C. 168 (1964) and T.C. Memo. 1964-299).  The taxpayer has the             
          burden of proving that the Commissioner's determination of the              
          additions to tax under section 6653(a) is erroneous.  Rule                  
          142(a); Bixby v. Commissioner, 58 T.C. 757 (1972).                          
               Petitioner has not presented evidence to establish that she            
          was not negligent or did not disregard rules or regulations.                
          Accordingly, we sustain respondent's determination.                         
          Issue 7. Substantial Understatement                                         
               Respondent determined that petitioner was liable for the               
          addition to tax for substantial understatement under section                
          6661(a).                                                                    
               Section 6661(a) imposes an addition to tax on a substantial            
          understatement of income tax.  The section provides that if there           
          is a substantial understatement of income tax, there shall be               
          added to the tax an amount equal to 25 percent of the amount of             
          any underpayment attributable to such understatement.  Sec.                 
          6661(a).6  The taxpayer bears the burden of proving that the                


          6  Sec. 6661, as originally enacted in 1982, set the amount of              
          the addition at 10 percent of the amount of any underpayment                
          attributable to the substantial understatement.  Sec. 8002 of the           
          Omnibus Budget Reconciliation Act of 1986, Pub. L. 99-509, 100              
          Stat. 1874, 1951, amended sec. 6661(a) to increase the amount of            
          the addition to 25 percent for additions assessed after October             
          21, 1986.  See Pallottini v. Commissioner, 90 T.C. 498, 501-502             
          (1988).  Since the addition will not be assessed until the                  
          Court's decision is final, the 25-percent rate applies.  Kim v.             
          Commissioner, T.C. Memo. 1991-288.                                          



Page:  Previous  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  23  24  25  26  Next

Last modified: May 25, 2011