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The addition equals 5 percent for each month that the return is
late, not to exceed 25 percent. Sec. 6651(a)(1). Additions to
tax under sections 6651(a)(1) are imposed unless the taxpayer
establishes that the failure was due to reasonable cause and not
willful neglect. Petitioners must prove both reasonable cause
and a lack of willful neglect. Crocker v. Commissioner, 92 T.C.
899, 912-913 (1989). "Reasonable cause" requires the taxpayers
to demonstrate that they exercised ordinary business care and
prudence. United States v. Boyle, 469 U.S. 241, 246 (1985).
Willful neglect is defined as a "conscious, intentional failure
or reckless indifference." United States v. Boyle, Id. at 245.
Petitioners filed their 1995 Federal income tax return
electronically on May 14, 1996. They did not testify as to why
they did not file their return on time. They failed to prove
that they had reasonable cause for their late filing and that
there was a lack of willful neglect. Therefore, we hold that
petitioners are liable for the section 6651(a)(1) addition to
tax.
To reflect the foregoing,
Decision will be entered
under Rule 155.
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Last modified: May 25, 2011