AMW Investments, Inc. - Page 25

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               Petitioner filed its 1988 and 1989 Forms 1120 almost 2 years           
          past the due dates, and petitioner filed its 1990 Form 1120 more            
          than 6 months late.  Petitioner has not argued that it had                  
          reasonable cause for these late filings.  Given the additional              
          fact that the record does not otherwise establish reasonable                
          cause for petitioner’s late filings, we sustain respondent on               
          this issue.                                                                 
          4.  Section 6653(a)                                                         
               Respondent determined that petitioner was liable for an                
          addition to its 1988 tax under section 6653(a).  Section 6653(a)            
          applies when any part of an underpayment of tax is due to                   
          negligence or intentional disregard of rules or regulations.                
          For petitioner’s 1988 taxable year, section 6653(a)(1) imposes an           
          addition to tax equal to 5 percent of the entire underpayment if            
          any portion of the underpayment is attributable to negligence.              
          Negligence connotes the lack of due care or failure to do what a            
          reasonable and ordinarily prudent person would do under the                 
          circumstances.  Neely v. Commissioner, 85 T.C. 934, 947 (1985).             
          Given the fact that respondent determined that petitioner was               
          negligent, petitioner must prove her wrong.  Rule 142(a); Bixby             
          v. Commissioner, 58 T.C. 757, 791-792 (1972).                               
               Petitioner contends that it was unsophisticated about tax              
          laws, and that it relied on MBS to provide Mr. Shindel with                 

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Last modified: May 25, 2011