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portion of the underpayment for which the taxpayer shows that he or
she: (1) Had reasonable cause, and (2) acted in good faith with
respect thereto. Sec. 6664(c); see also United States v. Boyle,
469 U.S. 241, 242 (1985). Whether a taxpayer had reasonable cause
and acted with good faith is a factual determination. Sec. 1.6664-
4(b), Income Tax Regs.
The parties agree that the section 6662(g) penalty is
inapplicable unless the Court decides that the moment-of-death
value of the 1,226 shares of JPMS common stock was $57 million or
more.26 On the basis of our determination that the fair market
value of the 1,226 shares of JPMS stock as of April 21, 1989, was
$41,532,600, the section 6662(g) penalty does not apply.
In light of the foregoing, and to reflect concessions and
settled issues,
Decision will be
entered under Rule 155.
26 The Federal estate tax return valued the stock at $28.5
million. For sec. 6662(g) to apply, the value reported on the
return must not be more than 50 percent of the correct value.
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