- 45 -
tax return for that year and he did not prove that the failure to
timely file was due to reasonable cause.
Section 6651(a)(1) imposes an addition to tax of 5 percent
of the amount of the tax due for each month a return is
delinquent, up to a maximum of 25 percent. The addition to tax
is not applicable if it is shown that the failure is due to
reasonable cause and not willful neglect. Sec. 6651(a)(1);
United States v. Boyle, 469 U.S. 241, 245 (1985). Petitioner has
the burden of proving that his failure to file was due to
reasonable cause and not to willful neglect. Niedringhaus v.
Commissioner, 99 T.C. 202, 220-221 (1992); Baldwin v.
Commissioner, 84 T.C. 859, 870 (1985). To prove "reasonable
cause", taxpayers must show that they exercised ordinary business
care and prudence and were nevertheless unable to file the return
within the statutorily prescribed time. Crocker v. Commissioner,
supra at 913; sec. 301.6651-1(c)(1), Proced. & Admin. Regs.
Taxpayers may, generally, establish reasonable cause by proving
that they reasonably relied on the advice of an accountant or
attorney that it was unnecessary to file a return and later found
that the advice was erroneous or mistaken. United States v.
Boyle, supra at 250; Estate of Paxton v. Commissioner, 86 T.C.
785, 820 (1986).
Mr. Gherman did not address this issue on brief, nor did he
present any evidence at trial which would prove that he had
reasonable cause for failing to timely file his return for year
Page: Previous 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 NextLast modified: May 25, 2011