- 20 -
underpayment attributable to a taxpayer's negligence or disregard
of rules and regulations. Sec. 6662(a), (b)(1). The term
"negligence" includes any failure to do what a reasonable and
ordinarily prudent person would do under the same circumstances.
Neely v. Commissioner, 85 T.C. 934, 947 (1985). The term
"disregard" includes any careless, reckless, or intentional
disregard. Sec. 6662(c). The penalty does not apply to any
portion of an underpayment for which there was reasonable cause
and with respect to which the taxpayer acted in good faith. Sec.
6664(c). Respondent's determination imposing the accuracy-
related penalty is presumed correct, and taxpayers bear the
burden of proving that they are not liable for the accuracy-
related penalty imposed by section 6662(a). Rule 142(a);
Tweeddale v. Commissioner, 92 T.C. 501, 505 (1989).
While petitioner may honestly believe that he is entitled to
deductions for the expenses in question, his position is not
reasonable under the circumstances. Prudent individuals in
petitioner's position would be aware that engaging in the trade
or business of a writer does not transform personal expenses into
deductible business expenses, simply because "life's experiences"
are incorporated into their literary materials. Additionally,
petitioner offered little evidence to substantiate the business
relationship between the expenses and his literary activities.
Petitioner has not met his burden of proof with respect to the
Page: Previous 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 NextLast modified: May 25, 2011