- 9 -
facts and circumstances. The most important factor is the extent
of the taxpayer's effort to assess his proper tax liability. See
Stubblefield v. Commissioner, T.C. Memo. 1996-537; sec. 1.6664-
4(b)(1), Income Tax Regs. Sec. 1.6664-4(b)(1), Income Tax Regs.,
specifically provides: "Circumstances that may indicate
reasonable cause and good faith include an honest
misunderstanding of fact or law that is reasonable in light of
the experience, knowledge and education of the taxpayer."
It is the taxpayer's responsibility to establish that he is
not liable for the accuracy-related penalty imposed by section
6662(a). Rule 142(a); Tweeddale v. Commissioner, 92 T.C. 501,
505 (1989). Petitioner did not address this issue at trial or in
any pleadings filed with the Court. Petitioners claimed expenses
and losses which they failed to explain or substantiate
adequately as required under section 6001. On the basis of the
entire record, we conclude petitioners have not established the
underpayment was due to reasonable cause and that they acted in
good faith. Accordingly, we hold petitioners are liable for the
accuracy-related penalty.
To reflect the foregoing,
Decision will be entered
for respondent.
Page: Previous 1 2 3 4 5 6 7 8 9
Last modified: May 25, 2011