- 68 -
Nevertheless, the parties have presented the issues in such
a way as to lead us to conclude that they believe that (1) if the
section 6166 election was valid, then there would not be a
section 6651(a)(2) addition to tax, and (2) if the section 6166
election was not valid, then there would be a section 6651(a)(2)
addition to tax, unless the failure to timely pay the tax was due
to reasonable cause and not willful neglect. Under these
circumstances, we will ignore the other considerations that might
have been dispositive, and limit ourselves to the reasonable
cause issue. See Estate of Fusz v. Commissioner, 46 T.C. 214,
215 n.2 (1966).
Petitioner contends that its failure to timely pay the
estate tax liability shown on its tax return was due to
reasonable cause and not due to willful neglect because (1)
illiquidity of the estate’s assets meant that prompt payment
would have resulted in “undue hardship”, relying on sec.
301.6651-1, Proced. & Admin. Regs., (2) the section 6166 election
was made in good faith and was untimely as “the direct result of
Petitioner’s reasonable reliance on his attorney’s erroneous
advice”, and (3)--
Petitioner did not receive any information that there were
any concerns with the filing of the return until he received
a letter from the IRS on March 8, 1995, more than a year
after the return was filed. In addition, the IRS did not
inform petitioner until September 30, 1996, that the section
6166 election was not going to be honored by the IRS.
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