- 18 -
for 1995, 1996, and 1997. Section 6651(a)(1) imposes an addition
to tax for failure to file a return timely unless the taxpayer
shows that the failure was due to reasonable cause and not
willful neglect. Respondent determined in the notices of
deficiency for 1995, 1996, and 1997 that petitioners were liable
for additions to taxes under section 6651(f). Section 6651(f)
applies when a failure to file a return is fraudulent.
The parties dispute who has the burden of proof as to this
issue. We may assume arguendo that the burden lies with
respondent, on the grounds that respondent’s allegation in answer
that petitioners are liable under section 6651(a) is a “new
matter” within the meaning of Rule 142(a)(1).
We are persuaded by the record that respondent has met his
burden of proof. Petitioners have never filed a 1995, 1996, or
1997 tax return, and their sole reason for not filing those
returns is that they are not individuals subject to tax. We
sustain respondent’s determination on this issue.11
IV. Section 6654 – Failure To Pay Estimated Income Tax
Respondent determined that petitioners underpaid their
estimated Federal income taxes and are liable for additions to
tax under section 6654. Section 6654 automatically applies to
11 Respondent also determined that petitioners are liable
for additions to their 1994 tax under sec. 6651(a). As to these
additions, for which petitioners have the burden of proof, we
also sustain respondent’s determination for reasons similar to
those just stated as to the other years.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011