Richard G. Cook and Patricia A. Cook - Page 8

                                                 - 8 -                                                   

            taxpayer in a manner that is arbitrary and capricious.  In                                   
            Hamacher v. Commissioner, supra at 354, the Court recited the                                
            background for the enactment of section 280A's restriction upon                              
            deduction of home office expenses and pointed out that one of the                            
            reasons for the enactment of section 280A was a response by                                  
            Congress to numerous cases, particularly those decided by this                               
            Court, which used a liberal standard to allow deduction of home                              
            office expenses that were "appropriate and helpful" to the                                   
            taxpayer's business under the circumstances.  Congress was                                   
            concerned that, under such a standard, personal, living, and                                 
            family expenses attributable to the home that are not otherwise                              
            deductible were being allowed as deductions.  The purpose of                                 
            section 280A was to restrict what Congress considered too liberal                            
            a standard in this area of tax law.  The restrictive provisions                              
            of section 280A, therefore, apply to all taxpayers.  The Court,                              
            therefore, rejects petitioners' contention that section                                      
            280A(c)(1) violates the Due Process Clause of the Fifth                                      
            Amendment.                                                                                   
                  Respondent determined that petitioners were liable for                                 
            penalties under section 6662(a) for negligence or disregard of                               
            rules or regulations under section 6662(b)(1).                                               
                  Section 6662(a) provides that, if it is applicable to any                              
            portion of an underpayment in taxes, there shall be added to the                             
            tax an amount equal to 20 percent of the portion of the                                      





Page:  Previous  1  2  3  4  5  6  7  8  9  10  Next

Last modified: May 25, 2011