- 39 -
of such underpayment * * * and ending on the date of the
assessment of the tax". Sec. 6653(a)(2)(B).
Section 6661
Robertson I also held petitioners liable for the
addition to tax under section 6661 that was determined by
respondent in the notice of deficiency. Petitioners bear
the burden of proving that respondent's determination is
wrong. See Rule 142(a).
Section 6661(a) provides that, if there is a
"substantial understatement of income tax", there shall
be added to the tax an amount equal to 25 percent of any
underpayment attributable to such understatement. An
"understatement" is the amount by which the tax required
to be shown on the return for the taxable year exceeds the
amount of tax shown on the return. Sec. 6661(b)(2)(A).
An understatement is substantial if it exceeds the greater
of 10 percent of the tax required to be shown on the return
or $5,000. See sec. 6661(b)(1)(A). As determined in
Robertson I, the understatement of tax in this case,
$16,135, is greater than both of those amounts.
Generally, the amount of the understatement is reduced
by that portion of the understatement which is attribut-
able to the tax treatment of any item if there is or was
substantial authority for such treatment, or the tax
Page: Previous 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 NextLast modified: May 25, 2011