- 14 -
shown on the return over the amount of tax that is shown on the
return, reduced by any rebates. Sec. 6662(d)(2)(A).
Section 6662(d)(2)(B) provides that the amount of the
understatement shall be reduced by that portion of the
understatement that is attributable to the tax treatment of any
item by the taxpayer if there is or was substantial authority for
the treatment, or any item with respect to which the relevant
facts affecting the item's tax treatment are adequately disclosed
in the return or in a statement attached to the return, and there
is reasonable basis for such treatment.
Petitioners did not establish that any of the exonerating
provisions of section 6662 or section 6664(c) would apply to
reduce the amount of, or extinguish the existence of, a
substantial understatement of income tax for 1992. Moreover,
petitioners conceded the underpayment of tax attributable to
their failure to report the IRA distribution on their 1992
return. Respondent, therefore, is sustained on the section
6662(a) penalty.
Decision will be entered
for respondent.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14
Last modified: May 25, 2011