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petitioner is liable for the fraud penalty under section 6663 for
1989 and that $28,320 of the underpayment for 1989 was due to
fraud. In the memorandum of authorities in support of the motion
for summary judgment, respondent conceded that $1,339 of the
underpayment for 1989 was not due to fraud. Respondent contends
that this amount is due to negligence under section 6662. The
deemed admissions establish that petitioner is liable for the
negligence penalty as to the $1,339 because petitioner failed to
keep adequate records and negligently failed to report income.
We will grant respondent's motion for summary judgment to
sustain the adjustments to income and addition to tax and
penalties determined in the notice of deficiency.
An appropriate order and
decision will be entered.
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Last modified: May 25, 2011