Robert A. and Colleen L. Lund - Page 13




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               Section 6662 imposes a penalty of 20 percent on any portion            
          of an underpayment of tax attributable to negligence or to                  
          disregard of the rules or the regulations.  For purposes of                 
          section 6662(a) negligence is a failure to make a reasonable                
          attempt to comply with the Internal Revenue Code.  See sec.                 
          6662(c).                                                                    
               The accuracy-related penalties under section 6662(a) do not            
          apply to any part of an underpayment if the taxpayer shows                  
          reasonable cause and if the taxpayer acted in good faith based on           
          the facts and circumstances.  See sec. 6664(c).  A taxpayer may             
          establish reasonable cause under section 6662(a) by proving                 
          reasonable reliance in good faith on the advice of a competent,             
          independent expert or tax professional.  See United States v.               
          Boyle, 469 U.S. 241, 250 (1985).                                            
               Where it is common knowledge that a tax planning proposal is           
          questionable, taxpayers are expected to make reasonable inquiry             
          as to the legality of the proposal.  See Neely v. United States,            
          775 F.2d 1092, 1095 (9th Cir. 1985).                                        
               Petitioner failed to consult with an attorney or accountant            
          regarding the trust program promoted by Bigelow Charter.                    
          Petitioners negligently disregarded the tax laws and are liable             
          for the accuracy-related penalties under section 6662(a).                   










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