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intentional disregard of rules and regulations under section
6662(b)(1). Ordinarily, section 6662 does not apply to tax years
for which the return is due before December 31, 1989. However,
in the case of carrybacks to years before 1990, section 1.6662-
3(d)(2), Income Tax Regs., provides:
[the accuracy-related penalty] under section 6662(b)(1)
is imposed on any portion of an underpayment for a
carryback year, the return for which is due * * *
before January 1, 1990, if--
(i) That portion is attributable to negligence or
disregard of rules or regulations in a loss * * * year;
and
(ii) The return for the loss * * * year is due
* * * after December 31, 1989.
The Court and the parties agree that all deficiencies at issue in
this case result directly from the NOL’s generated by the
writedowns of the Ridge and Minnechaug reflected in petitioners’
income tax returns for 1989 and 1990, the returns for which were
obviously due after December 31, 1989. Thus, in this case,
section 6662(a) is applicable to all of the years in issue even
though some of the years ended before section 6662 was enacted.
Section 6662(a) imposes a penalty equal to 20 percent of the
underpayment attributable to any of the causes listed in section
6662(b). Section 6662(b)(1) provides that one of the grounds for
imposition of the penalty is "Negligence or disregard of rules or
regulations."
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