- 106 -
“Negligence” includes a failure to make a reasonable attempt to
comply with the provisions of the Internal Revenue Code. Sec.
6653(a)(3). “Disregard” includes any careless, reckless, or
intentional disregard of rules or regulations. Id.; Crocker v.
Commissioner, 92 T.C. 899, 916-918 (1989); Neely v. Commissioner,
85 T.C. 934, 947-950 (1985). The negligence addition to tax will
apply if, among other things, the taxpayer fails to maintain
adequate books and records with regard to the items in question.
Crocker v. Commissioner, supra.
In the stipulation of settled issues, petitioner has
conceded that he understated income and overstated deductions
relating to his 1988 return. Petitioner has failed to prove that
those items were not due to negligence. Furthermore, petitioner
has conceded that he would be liable for the addition to tax for
negligence if we decide, as we have in part, that the funds he
took from corporate accounts must be included in his income in
1988. For 1988, the addition to tax for negligence applies to
the entire deficiency if any part of the deficiency is due to
negligence or intentional disregard of rules or regulations.
Accordingly, we conclude that petitioner is liable for the
addition to tax for negligence under section 6653(a) for the
deficiencies determined in the notice of deficiency and the
Page: Previous 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 NextLast modified: May 25, 2011