Lewis Peter and Judy Hasty Larson - Page 11




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          year.9  However, at no time did Mr. Larson, an experienced busi-            
          nessman, and Ms. Larson attempt to verify the accuracy of the               
          amount of nonemployee compensation (i.e., $1,892) that they                 
          assumed was shown in Form 1099 which Windermere issued to him for           
          1999.  We believe that petitioners should have attempted to                 
          ascertain why the amount that they assumed Windermere reported in           
          that form was extremely small when compared to the amount of work           
          that he performed for Windermere as a nonemployee during 1999.              
          They did not.10                                                             
               Based upon our examination of the entire record before us,             
          we find that petitioners have failed to carry their burden of               
          establishing that there was reasonable cause for, and that they             
          acted in good faith with respect to, the underpayment in this               
          case.  On that record, we find further that petitioners have                
          failed to carry their burden of establishing that they are not              
          liable for 1999 for the accuracy-related penalty under section              




               9Moreover, by reporting only $1,892, instead of $21,891.95,            
          as the amount of nonemployee compensation that Mr. Larson re-               
          ceived from Windermere during 1999, petitioners failed to report            
          approximately (1) 23� percent of the total nonemployee and                  
          employee compensation that Windermere paid to Mr. Larson during             
          that year and (2) 20� percent of the total nonemployee and                  
          employee compensation that all payors paid to Mr. Larson during             
          that year.                                                                  
               10Nor did petitioners attempt to determine why the amount              
          that they assumed Windermere reported in Form 1099 issued to Mr.            
          Larson for 1999 was small when compared to the amount of work               
          that he performed for Windermere as a nonemployee and an employee           
          during that year.                                                           





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