-7- expenses. Hartless Linen Serv. Co. v. Commissioner, 32 T.C. 1026 (1959). Petitioners claimed charitable contribution deductions on their Schedules C as ordinary and necessary business expenses. In this proceeding, however, petitioners failed to provide any proof that these claimed contributions were paid as legitimate business expenses. We sustain respondent’s determination as to this issue. See id. We allow petitioners to deduct these amounts under section 170 as itemized deductions, as determined by respondent. 3. Penalty Under Section 6673 Respondent moves the Court to require petitioners to pay to the United States a penalty under section 6673. Respondent asserts that petitioners’ positions in this proceeding are frivolous and groundless. Under section 6673(a), a taxpayer may be required to pay to the United States a penalty not in excess of $25,000 whenever it appears to the Court that, among other reasons, the proceedings have been instituted or maintained primarily for delay or the taxpayer’s position is frivolous or groundless. Larsen v. Commissioner, 765 F.2d 939, 941 (9th Cir. 1985). A taxpayer’s position is frivolous or groundless if it is contrary to established law and unsupported by a reasoned, color able argument for change in the law. Coleman v. Commissioner, 791 F.2d 68, 71 (7th Cir. 1986).Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011