- 23 -
failure to keep adequate records and properly substantiate would
be sufficient to sustain respondent’s burden for a negligence-
based imposition as well.
Furthermore, petitioners have failed to prove their
entitlement to relief under the section 6664 exception. An
absence of records, due to loss or destruction, cannot standing
alone establish that petitioners’ deductions were founded on
reasonable cause and good faith when made. In addition, the
explanation offered for why petitioners retained no records from
EJX can only be described as vague at best. The role of their
alleged return preparer, who we note did not sign the return, is
also less than clear. More importantly, there has been no
showing that the return preparer was provided with accurate
information such that any errors are attributable to him and not
to petitioners. We hold that petitioners are liable for the
section 6662(a) accuracy-related penalty.
To reflect the foregoing,
Decision will be entered
under Rule 155.
Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Last modified: May 25, 2011