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Some of the facts in this case have been stipulated and are
so found. Petitioners resided in St. Cloud, Florida, at the time
they filed their petition.
Gennaro Labato (petitioner) was incarcerated from August 16,
1996, to July 31, 1997. Petitioner claimed that when the time
came to file their tax return, petitioner Patricia Labato (Mrs.
Labato) requested an extension of time to file because she was
hoping that petitioner would be released from jail shortly
thereafter. Petitioner was not released when anticipated. Mrs.
Labato never received a response from the IRS. During
petitioner's period of incarceration, the IRS was aware that he
was being held in jail. After his release from jail, petitioner
filed the return for 1996 on September 23, 1997.
Respondent has no record of receiving from petitioners a
request for an extension of time to file.
Petitioners contend that petitioner's incarceration and his
inability to gather documents were reasonable cause for their
failure to timely file their return. Respondent contends that
petitioners had no reasonable cause for failing to timely file
their return.
Section 6651(a)(1) imposes an addition to tax for failure to
file a Federal income tax return by its due date, determined with
regard to any extension of time for filing previously granted.
The addition equals 5 percent for each month that the return is
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