Guillermo Baez Espinosa - Page 24

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                    (1) the underpayment rate established under section               
                    (2) to the amount of the underpayment,                            
                    (3) for the period of the underpayment.  [Sec.                    
               Unlike section 6651, the liability for the addition to tax             
          under section 6654 does not depend on a lack of reasonable cause            
          or the presence of willful neglect.                                         
               Petitioner has the burden of establishing that the additions           
          to tax should not apply.  Rule 142(a).  Petitioner essentially              
          contends that since respondent erroneously applied section 874(a)           
          to disallow the deductions, there is neither an "amount [of tax]            
          required to be shown", sec. 6651(a), nor an "underpayment of                
          estimated tax", sec. 6654(a).  We have rejected that argument.              
          Applying section 874(a), statutory predicates for the additions             
          to tax are present.  Furthermore, petitioner has not attempted to           
          establish that he satisfied the reasonable cause or lack of                 
          willful neglect exceptions contained in section 6651(a)(1).                 
          Accordingly, respondent's determinations as to the additions to             
          tax under sections 6651(a)(1) and 6654 are sustained.                       
               To reflect respondent's concession concerning the basis of             
          the property sold,                                                          
                                                  Decision will be entered            
                                             under Rule 155.                          

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Last modified: May 25, 2011