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issue. Consequently, we hold that petitioners are liable for tax
on Social Security benefits pursuant to section 86.
Accuracy-Related Penalty
Respondent determined that petitioners are liable for an
accuracy-related penalty under section 6662(a) for negligence or
disregard of rules or regulations. Section 6662(a) imposes a 20-
percent penalty on the portion of an underpayment that is
attributable to negligence or disregard of rules or regulations.
Under section 6662(c), "negligence" includes failure to make a
reasonable attempt to comply with the provisions of the Internal
Revenue Code. Negligence is a “‘lack of due care or failure to
do what a reasonable and ordinarily prudent person would do under
the circumstances.’” Neely v. Commissioner, 85 T.C. 934, 947
(1985) (quoting Marcello v. Commissioner, 380 F.2d 499, 506 (5th
Cir. 1967), affg. in part and remanding per curiam 43 T.C. 168
(1964)). “Disregard” includes careless, reckless, or intentional
disregard of rules or regulations. Sec. 6662(c).
No penalty shall be imposed if the taxpayer acted in good
faith and there was reasonable cause for the underpayment. Sec.
6664(c)(1). The burden is on the taxpayer to prove the
Commissioner's imposition of the penalty is in error. Luman v.
Commissioner, 79 T.C. 846, 860-861 (1982); Bixby v. Commissioner,
58 T.C. 757 (1972).
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