Robert A. Inzano and Martha O. Chavez - Page 11

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          Section 6651(a)(1) imposes an addition to tax for failure to file           
          timely a tax return unless it is shown that such failure is due             
          to reasonable cause and not willful neglect.  A taxpayer can                
          establish reasonable cause by showing that, despite the exercise            
          of ordinary care and prudence, the taxpayer was unable to file              
          the required tax return within the prescribed time.  United                 
          States v. Boyle, 469 U.S. 241, 246 (1985); Crocker v.                       
          Commissioner, 92 T.C. 899, 913 (1989); sec. 301.6651-1(c)(1),               
          Proced. and Admin. Regs.  Willful neglect has been defined as a             
          conscious, intentional failure or reckless indifference to timely           
          filing a return.  United States v. Boyle, supra at 245.                     
          Petitioners have the burden of proof.  Rule 142(a).                         
               It is undisputed that petitioners did not timely file their            
          individual tax return for taxable year 1990.  Petitioners argue             
          that they had no expectation that any tax was due, because JDB’s            
          business was not profitable.                                                
               We conclude that petitioners have not met their burden of              
          proof.  An unverified belief that no taxes are owing does not               
          constitute reasonable cause of the sort that will allow                     
          petitioners to escape the addition to tax pursuant to section               
          6651(a)(1).  Olsen v. Commissioner, T.C. Memo. 1993-432, and                
          cases cited therein. The question is not whether petitioners                
          thought that they owed tax, but whether they knew or should have            
          known that they needed to file a return.  Jackson v.                        





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