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rules or regulations. Sec. 6662(a) and (b)(1). Negligence is
the lack of due care or the failure to do what a reasonable and
prudent person would do under the circumstances. Neely v.
Commissioner, 85 T.C. 934, 947 (1985). Negligence includes any
failure to make a reasonable attempt to comply with the
provisions of the Internal Revenue Code, and disregard includes
any careless, reckless, or intentional disregard. Sec. 6662(c).
No penalty shall be imposed with respect to any portion of an
underpayment if it is shown that there was a reasonable cause for
such portion and that the taxpayer acted in good faith with
respect to such portion. Sec. 6664(c)(1).
Petitioners were negligent in claiming that the Burlington
house was their principal residence and attempting to defer the
gain on its sale. They have failed to provide any evidence that
they acted in good faith or had reasonable cause for claiming the
Burlington house as their principal residence in 1989. See supra
note 20. Thus, we hold for respondent on this issue.
In keeping with the above holdings,
Decision will be entered
under Rule 155.
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