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Pursuant to section 6664(c)(1), a section 6662 penalty does
not apply to any portion of an underpayment if reasonable cause
existed and the taxpayers acted in good faith. Pursuant to section
1.6664-4(b)(1), Income Tax Regs., all facts and circumstances must
be examined in order to determine whether a taxpayer acted with
reasonable cause and in good faith.
Petitioner contends that we should not sustain respondent's
imposition of the section 6662(a) accuracy-related penalties
because Mr. Goldman received and relied upon an opinion letter
prepared by experienced tax counsel. In order to establish good
faith reliance on the advice of an adviser, the taxpayer must prove
that: (1) He gave the return preparer complete and accurate
information, (2) an incorrect return was a result of the preparer's
mistakes, and (3) the taxpayer believed in good faith that he was
relying on a competent return preparer's advice. See Metra Chem
Corp. v. Commissioner, 88 T.C. 654, 662 (1987). These requirements
have been met in this case. Consequently, we do not sustain
respondent's determination imposing the section 6662(a) accuracy-
related penalties.
To reflect the foregoing,
Decision will be
entered under Rule 155.
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Last modified: May 25, 2011