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find there to be no indication that petitioner reported any
alimony income in 1997. In 1996, none of the sources of
petitioner’s income were shown. In 1995, petitioner reported no
income in excess of the income reported on her Form W-2, Wage and
Tax Statement, and her Form 1099-R, Distributions From Pensions,
Annuities, Retirement Plans, IRAs, Insurance Contracts, etc. It
is therefore clear that no part of her reported income in that
year could have been from alimony, which was to be paid by Mr.
Lesnik through the county court. Finally, petitioner did not
dispute the statement in the notice of deficiency that she
reported no alimony income in each of the years in issue.
We uphold respondent’s determination that petitioner is
liable for the accuracy-related penalties, but only as to that
portion of the penalties which is attributable to her failure to
report what she has conceded to be alimony--$150 per month.
Petitioner’s statements in the record indicate she knew the
amounts to be taxable and yet failed to report them.
On the other hand, we find that petitioner had reasonable
cause in maintaining her position that the remainder of the
payments were not alimony, and therefore should not be includable
in her income. This position was a reasonable and honest
misunderstanding of fact and law, and we accept it as
petitioner’s honest belief. See sec. 1.6664-4(b)(1), Income Tax
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