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sustain respondent’s determination denying petitioner a
deduction for compensation allegedly accrued but unpaid by the
close of petitioner’s fiscal year ended July 31, 1994.
Issue 2. Late-Filing Additions
Petitioner’s fiscal years at issue in this case ended on
July 31, 1992, 1993, and 1994. Absent extension, the deadlines
for filing petitioner’s Federal income tax returns were October
15, 1992, October 15, 1993, and October 17, 1994,5 respectively.
See sec. 6072(b) (“returns made on the basis of a fiscal year
shall be filed on or before the 15th day of the third month
following the close of the fiscal year”). The parties have
stipulated that the returns were delinquently filed on February
9, 1993, June 13, 1994, and March 1, 1995.
Under section 6651(a)(1), there shall be imposed on a
taxpayer who fails timely to file an income tax return an
addition to tax of 5 percent of the tax due for each month or
partial month of the delinquency, not to exceed 25 percent,
“unless it is shown that such failure is due to reasonable cause
and not due to willful neglect”. Respondent determined a 20-
percent addition to tax for petitioner’s 4-month delay in filing
its 1993 return, and 25-percent additions to tax for the more
than 5-month delays in filing its 1994 and 1995 returns.
5Oct. 15, 1994, fell on a Saturday. Therefore, petitioner
had until the following Monday to file its return. See sec.
7503.
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