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to negligence or intentional disregard of rules or regulations.
Section 6662(a) imposes a penalty in an amount equal to 20
percent of the underpayment of tax attributable to one or more of
the items set forth in section 6662(b). Section 6662(b)(1)
applies an accuracy-related penalty to the portion of an
underpayment attributable to negligence or disregard of rules or
regulations. Petitioners bear the burden of proving that
respondent's determination is erroneous. Rule 142(a); Axelrod v.
Commissioner, 56 T.C. at 258-259.
“Negligence” includes a failure to make a reasonable attempt
to comply with the provisions of the internal revenue laws.
Secs. 6653(a)(3), 6662(c); sec. 1.6662-3(b)(1), Income Tax Regs.
“Disregard” includes any careless, reckless, or intentional
disregard of rules or regulations. Sec. 6662(c); Crocker v.
Commissioner, 92 T.C. at 916; Neely v. Commissioner, 85 T.C. 934,
947-948 (1985); sec. 1.6662-3(b)(2), Income Tax Regs.
The Takaos’ failure to maintain and to produce reliable
records of their financial transactions and taxable income
supports a conclusion of negligence. Crocker v. Commissioner,
supra at 917; Schroeder v. Commissioner, 40 T.C. at 34.
Moreover, they cannot avoid the addition to tax or penalty on the
basis of reliance on their tax preparer, because they did not
provide Nakamura with records or other information sufficient to
prepare their returns accurately. Metra Chem. Corp. v.
Commissioner, 88 T.C. 654, 662 (1987). The evidence justifies
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