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Therefore, we hold that one-half of petitioner's Social
Security disability benefits, in the amount of $3,150 is taxable
for the year in issue. Sec. 86(a). Petitioners failed to
present any evidence contrary to respondent's position. Rule
142(a). Accordingly, respondent is sustained on this issue.
The final issue for decision is whether petitioners are
liable for the section 6662(a) accuracy-related penalty. Section
6662(a) imposes a 20-percent penalty on the portion of an
underpayment attributable to any one of various factors, one of
which is negligence. Respondent determined that petitioners are
liable for the accuracy-related penalty imposed by section
6662(a), and that the entire underpayment of tax was due to
negligence. "Negligence" includes a failure to make a reasonable
attempt to comply with the provisions of the Internal Revenue
laws or to exercise ordinary and reasonable care in the
preparation of a tax return. Sec. 6662(c); sec. 1.6662-3(b)(1),
Income Tax Regs. "Disregard" includes any careless, reckless, or
intentional disregard of rules or regulations. Sec. 6662(c);
sec. 1.6662-3(b)(2), Income Tax Regs.
However, section 6664(c)(1) provides that the penalty under
section 6662(a) shall not apply to any portion of an
underpayment, if it is shown that there was reasonable cause for
the taxpayer's position with respect to that portion and that the
taxpayer acted in good faith with respect to that portion. Sec.
6664(c)(1). The determination of whether a taxpayer acted with
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Last modified: May 25, 2011