- 3 -
$37,959.55 and also determined that interest on deficiencies
accruing after December 31, 1984, would be calculated at 120
percent of the statutory rate under section 6621(c).2 In a
notice of deficiency, respondent determined the following
deficiencies in and additions to Sorey's Federal income taxes:
Increased
Interest Additions to Tax
Year Deficiency Sec. 6621(c) Sec. 6653(a)(1) Sec. 6653(a)(2) Sec. 6659
1978 $10,022 1 --- --- $3,006.60
1979 382 --- --- --- 114.60
1981 11,737 1 $586.85 2 3,521.10
1120 percent of the interest payable under sec. 6601 with respect to any
substantial underpayment attributable to tax-motivated transactions.
250 percent of the interest payable with respect to the portion of the
underpayment attributable to negligence.
The deficiencies in the Sorey case, docket No. 7908-89, for
taxable years 1978 and 1979 result from disallowance of
investment tax credit carrybacks and business energy credit
carrybacks from taxable year 1981. In addition to the above
deficiencies and additions to tax, in amended answers, respondent
asserted the following: (1) In the Wilson case, docket No.
2
The notice of deficiency in the Wilson case, docket No.
21243-85, refers to sec. 6621(d). This section was redesignated
as sec. 6621(c) by sec. 1511(c)(1)(A) of the Tax Reform Act of
1986, Pub. L. 99-514, 100 Stat. 2085, 2744, and repealed by sec.
7721(b) of the Omnibus Budget Reconciliation Act of 1989 (OBRA
89), Pub. L. 101-239, 103 Stat. 2106, 2399, effective for tax
returns due after Dec. 31, 1989, OBRA 89 sec. 7721(d), 103 Stat.
2400. The repeal does not affect the instant cases. For
simplicity, we shall refer to this section as sec. 6621(c). The
annual rate of interest under sec. 6621(c) for interest accruing
after Dec. 31, 1984, equals 120 percent of the interest payable
under sec. 6601 with respect to any substantial underpayment
attributable to tax-motivated transactions.
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