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losses realized in connection with BRVC during 1992 and 1993.14
Petitioner is sustained on this issue.
The final issue is whether petitioner is liable for the
accuracy-related penalty under section 6662(a) for negligence or
disregard of rules or regulations for each of the years at issue.
Section 6662(a) provides that, if it is applicable to any portion
of an underpayment in taxes, there shall be added to the tax an
amount equal to 20 percent of the portion of the underpayment to
which section 6662 applies. Since the Court has held in favor of
petitioner on the issue of whether BRVC was an activity not
engaged in for profit during the years at issue and thus has
negated all of the adjustments in the notice of deficiency, there
exists no further underpayment to which the accuracy-related
penalty under section 6662(a) may be applied. Thus, petitioner
is not liable for the section 6662(a) penalty.
Decision will be entered
for petitioner.
14 Respondent conceded that petitioner substantiated the
expenses claimed on her 1992 and 1993 Federal income tax returns
in connection with BRVC.
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