Estate of David J. Dickerson, Deceased, Dorothy Dickerson, Executor and Dorothy Dickerson, et al. - Page 40

                                       - 40 -                                         
          Additions to Tax for Negligence and Accuracy-related Penalty                
               Respondent determined that all petitioners in these cases              
          are liable for additions to tax or accuracy-related penalties for           
          negligence for the years in which they had underpayments.                   
          Different sections apply to the various years in issue.  Secs.              
          6653(a)(1)(A) and (B) (for 1986 and 1987), 6653(a)(1) (for 1988),           
          6662(a) (for 1989 and 1990).  Negligence is defined as a lack of            
          due care or failure to do what a reasonable and ordinarily                  
          prudent person would do under the circumstances.  Neely v.                  
          Commissioner, 85 T.C. 934, 947-948 (1985).  Petitioners bear the            
          burden of proving that respondent's determinations are erroneous.           
          Rule 142(a).                                                                
               The Dickersons claim that they should not be liable for the            
          negligence penalty because they are entitled to the deductions              
          they claimed or because their unreported rental income was offset           
          by expenses.  This is essentially arguing that they are not                 
          liable for the negligence penalty because they did not underpay             
          their tax.  We have already found that they did underpay their              
          tax.  Respondent is sustained with respect to the negligence                
          penalty resulting from underpayments by the Dickersons.                     
               The Michoff, Srs., “admit they unintentionally omitted items           
          from their tax return due to inadvertence and lack of knowledge”            
          but contend that they should not be burdened with additions to              
          tax for negligence or the accuracy-related penalty.  The Michoff,           
          Srs., have failed to offer any proof that they were not negligent           
          in their underpayment.  Respondent is sustained with respect to             

Page:  Previous  23  24  25  26  27  28  29  30  31  32  33  34  35  36  37  38  39  40  41  42  Next

Last modified: May 25, 2011