Earle E. Murphy - Page 19

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            nor DHF reported any interest income for 1988.  We find that                               
            petitioner has not met his burden of proof on this issue.  See                             
            Rule 142(a).  Therefore, we sustain respondent's determination.                            
                  The next issue we must decide is whether petitioner is                               
            liable for additions to tax pursuant to section 6651(a)(1) and                             
            (2).  Section 6651(a)(1) imposes an addition to tax for failure                            
            to timely file a tax return, unless the taxpayer establishes that                          
            the failure to file was due to reasonable cause and not willful                            
            neglect.  Section 6651(a)(2) imposes an addition to tax for                                
            failure to timely pay a tax liability shown upon a return, unless                          
            the taxpayer establishes that the failure was due to reasonable                            
            cause and not willful neglect.                                                             
                  Petitioner received an automatic extension to file his 1988                          
            return on or before August 15, 1989.  Petitioner did not meet                              
            this deadline, as he did not mail his return until September 2,                            
            1989.  At the time that he filed, petitioner failed to include                             
            full payment of his reported income tax liability.  On brief,                              
            petitioner argues that he had no income tax liability for 1988,                            
            because no liquidation occurred, and petitioner was simply an                              
            agent of FSRC with respect to the sales proceeds reinvested in                             
            LPRC.  We have already concluded, however, that a liquidation, in                          
            fact, occurred and that petitioner has income to the extent that                           
            the distribution exceeds the adjusted basis in petitioner's                                
            stock.  Moreover, petitioner has not introduced any evidence that                          






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