Roger G. and Lilianne J. G. Maki - Page 6

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          reasonable cause and in good faith within the meaning of section            
          6664(c)(1) is made on a case-by-case basis, taking into account             
          all the pertinent facts and circumstances.  Sec. 1.6664-4(b)(1),            
          Income Tax Regs.  The most important factor is the extent of the            
          taxpayers' effort to assess their proper tax liability for the              
          year.  Id.                                                                  
               Petitioners prepared their 1991 Federal income tax return.             
          Although we found petitioner to be a credible witness, the record           
          fails to establish that petitioners acted with reasonable cause             
          and in good faith in assessing whether petitioner's Social                  
          Security disability benefits were taxable.  Social Security                 
          disability payments have been subject to tax since 1984.  The               
          record shows that respondent has challenged petitioner's failure            
          to include his Social Security disability benefits as taxable               
          income in the past.  Other than their reliance on the Form 886-A,           
          petitioners offered no proof that they made good faith efforts to           
          assess their proper tax liability.                                          
               Based on this record, we conclude that petitioners are                 
          liable for the section 6662 accuracy-related penalty.                       
               To reflect the foregoing,                                              


                                                  Decision will be entered            
                                                  for respondent.                     







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