Mark and Helen Thomson - Page 9




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          in petitioners’ favor, that the aircraft parts in question are              
          depreciable over a 5-year recovery period.                                  
          Accuracy-Related Penalty                                                    
               Respondent determined in the notice that petitioners are               
          liable for the accuracy-related penalty under section 6662(a) for           
          each of the years 1993 and 1994 because their underpayment of tax           
          for each of those years was due to negligence or disregard of               
          rules or regulations.                                                       
               For purposes of section 6662(a), the term “negligence”                 
          includes any failure to make a reasonable attempt to comply with            
          the Code, and “disregard” includes any careless, reckless, or               
          intentional disregard.  See sec. 6662(c).  Negligence has also              
          been defined as a lack of due care or failure to do what a                  
          reasonable person would do under the circumstances.  See Leuhsler           
          v. Commissioner, 963 F.2d 907, 910 (6th Cir. 1992), affg. T.C.              
          Memo. 1991-179; Antonides v. Commissioner, 91 T.C. 686, 699                 
          (1988), affd. 893 F.2d 656 (4th Cir. 1990).                                 
               The accuracy-related penalty under section 6662(a) does not            
          apply to any portion of an underpayment if it is shown that there           
          was reasonable cause for such portion and that the taxpayer acted           
          in good faith.  See sec. 6664(c)(1).  The determination of                  
          whether the taxpayer acted with reasonable cause and in good                
          faith depends on the pertinent facts and circumstances.  See sec.           
          1.6664-4(b)(1), Income Tax Regs.  The most important factor is              






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