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does not determine a deficiency for 1989 but merely gives notice
to petitioner of respondent's determination that petitioner is
liable for a penalty pursuant to section 6663.
Section 6665 provides that "additions to the tax, additional
amounts, and penalties * * * shall be paid upon notice and demand
and shall be assessed, collected, and paid in the same manner as
taxes". A deficiency in tax is assessed, collected, and paid
only after respondent makes a determination and sends a notice of
that determination in accordance with section 6213, which
provides for the jurisdiction of this Court. Eck v.
Commissioner, 16 T.C. 511, 515 (1951), affd. per curiam 202 F.2d
750 (2d Cir. 1953). Thus, respondent, in sending a notice
determining petitioner was liable for a section 6663 penalty, was
complying with the law that requires him to proceed in the same
manner as if there were a deficiency. "The statute was intended
to mean * * * that where such a notice was sent, the Tax Court
has jurisdiction." Id. Accordingly, a statutory notice from
respondent, in which no deficiency is determined, advising the
taxpayer that a penalty for fraud is due, is a valid basis for
jurisdiction to this Court.
The penalty in the case of fraud is a civil sanction
provided primarily as a safeguard for the protection of the
revenue and to reimburse the Government for the heavy expense of
investigation and the loss resulting from the taxpayer's fraud.
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Last modified: May 25, 2011