- 5 -
Therefore, even though N & M misclassified petitioner as an
independent contractor, petitioner is liable for income tax for
the year in issue. Cf. Grooms v. Commissioner, T.C. Memo. 1992-
291.
It is unfortunate that N & M did not ask petitioner to
complete a Form W-4 for the year in issue and did not withhold
income tax from petitioner's wages. If it had done so, there
might not have been any deficiency in income tax in respect of
such wages. However, N & M never withheld, and petitioner was
paid his gross wages without any reduction for withheld income
tax. As a consequence, there is a deficiency in income tax for
which petitioner is liable. We therefore hold for respondent on
this issue.
B. Addition to Tax for Failure To File Timely
Section 6651(a)(1) provides for a 5 percent per month
addition to tax, not to exceed 25 percent, if a taxpayer fails to
file timely a Federal income tax return, unless such failure is
due to reasonable cause and not due to willful neglect. The
taxpayer has the burden of proving that the Commissioner's
determination of the addition to tax is erroneous. See BJR Corp.
v. Commissioner, 67 T.C. 111, 131 (1976); Bebb v. Commissioner,
36 T.C. 170 (1961); cf. sec. 7491, effective for court
proceedings arising in connection with examinations commencing
after July 22, 1998.
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