Raymond Verni Schroeder - Page 12

          Isolated computational errors are not inconsistent with                     
          reasonable cause and good faith.  Id.                                       
               Respondent determined an accuracy-related penalty on a                 
          portion of the deficiency in the amount of $1,222.  It is not               
          entirely clear to which adjustments this portion of the                     
          underpayment is attributable.  However, it appears that                     
          respondent did not determine the penalty on the underpayment                
          attributable to self-employment taxes of $4,191 and the                     
          associated reduction in income taxes resulting from the deduction           
          allowed with respect to the self-employment tax.                            
               Based on the record, we find that the penalty does not apply           
          to the portion of the underpayment attributable to the adjustment           
          with respect to the taxable Social Security benefits.                       
               To reflect the foregoing,                                              

                                                  Decision will be entered            
                                             under Rule 155.                          

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Last modified: May 25, 2011