- 20 -
We believe that the Nortons have sustained their burden of
establishing reasonable cause and good faith. Numerous deductions
disallowed by respondent in his notice of deficiency were
subsequently conceded fully or in large measure by respondent. The
Nortons were not tax sophisticated. As a result, they actively
sought assistance in determining their tax liability. Although
some of that advice was inaccurate, we accept Mr. Norton’s
testimony that they reasonably relied upon the advice of two
attorneys as well as their tax preparer in reporting their income
and expenses. Moreover, there is nothing in the record to indicate
that the Nortons’ conduct was negligent or undertaken in reckless
disregard of applicable Code sections. Accordingly, we hold that
the Nortons are not liable for the accuracy-related penalty.
In reaching our conclusions herein, we have considered all
arguments presented and, to the extent not discussed above, find
them to be irrelevant or without merit.
Page: Previous 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 NextLast modified: May 25, 2011