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addition to tax of 0.5 percent per month up to 25 percent for
failure to pay the amount shown or required to be shown on a
return. A taxpayer may fail to file and pay a tax and thus be
subject to both section 6651(a)(1) and (2). See sec. 6651(c)(1).
If that occurs, the amount of the addition to tax under section
6651(a)(1) is reduced by the amount of the addition to tax under
section 6651(a)(2) for any month to which an addition to tax
applies under both paragraphs (1) and (2). The combined amounts
under paragraphs (1) and (2) cannot exceed 5 percent per month.
See sec. 6651(c)(1).
To escape the additions to tax for filing late returns,
petitioners have the burden of proving that the failure to file
did not result from willful neglect and that the failure was due
to reasonable cause. See United States v. Boyle, 469 U.S. 241,
245 (1985). Reasonable cause requires taxpayers to demonstrate
that they exercised "ordinary business care and prudence" but
nevertheless were "unable to file the return within the
prescribed time." Sec. 301.6651-1(c)(1), Proced. & Admin. Regs.
Petitioners argue that they used ordinary business care and
prudence because they were acting at all times upon the advice of
a certified public accountant who prepared their returns.
Petitioners also claim that, due to their financial crisis at the
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