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portion of the underpayment and that the taxpayer acted in good
faith with respect to such portion. Reliance on the advice of a
professional, such as an accountant, may constitute a showing of
reasonable cause if, under all the facts and circumstances, such
reliance is reasonable and the taxpayer acted in good faith.
Sec. 1.6664-4(c), Income Tax Regs.
Petitioner asserts that no penalty under section 6662(a) and
(b)(2) should be imposed. It maintains that, pursuant to Rev.
Proc. 90-16, supra, its return for the year ended June 30, 1990,
adequately disclosed the relevant facts concerning its claimed
compensation deduction to Mr. Martin. Alternatively, petitioner
argues that it qualifies under the section 6664(c)(1) reasonable-
cause-and-good-faith exception to the penalty. We agree with
petitioner that there was adequate disclosure in its return,
since a properly completed Schedule E concerning its officers'
compensation was included in petitioner's return. We hold that
petitioner is not liable for a penalty under section 6662(a) and
(b)(2) for the year ended June 30, 1990. Notice 90-20, supra;
Rev. Proc. 90-16, supra.
To reflect the foregoing and the parties' concessions,
Decision will be entered
under Rule 155.
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