- 13 -
they intended to profit from their investment.6 Thus, we do not
find Heasley controlling in the instant case.
Accordingly, we sustain respondent's determination with
respect to the additions to tax for negligence insofar as it
pertains to the GD&L container leasing investment.7
Section 6651(a)(1) Addition to Tax for Delinquency
Section 6651(a)(1) imposes an addition to tax for failure to
file a tax return or pay any tax by the applicable due date,
unless it is shown that such failure is due to reasonable cause
and not willful neglect. United States v. Boyle, 469 U.S. 241,
246 (1985). Petitioners bear the burden of proving that their
failure to file a timely return was due to reasonable cause and
not willful neglect. Neubecker v. Commissioner, 65 T.C. 577, 586
(1975).
Generally, individuals who compute their taxes on a calendar
year basis must file their Federal income tax return by the 15th
day of April following the close of the taxable year. Sec.
6 There is ample evidence to suggest that petitioners
invested in the container leasing program primarily to reduce
their Federal tax liability. Petitioner's testimony emphasized
his desire to reduce their income tax liability through
investments. In addition, his review of the promotional
materials focused on the tax benefits which could be obtained by
investing in the container program. Although Mrs. McPike
suggested that petitioners had a profit motive, we think that
petitioners invested in the container program for its tax
benefits, and any profit motive was incidental.
7 We emphasize again that, in our judgment, respondent
has conceded there is no negligence with respect to the claimed
losses of the Winthrop Trust, and this should be reflected in the
Rule 155 computations.
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