- 10 - additions to tax for 1983 and 1984 of $764 and $18 under section 6653(a)(1), and 50 percent of the interest due on a $15,285 deficiency and on a $359 deficiency under section 6653(a)(2). Respondent also determined that petitioners are liable for an addition to tax for 1983 in the amount of $3,821 under section 6661(a). Discussion Negligence Section 6653(a)(1) imposes an addition to tax equal to 5 percent of the underpayment of tax if any part of the underpayment is attributable to negligence or intentional disregard of rules or regulations. Section 6653(a)(2) provides for a further addition to tax equal to 50 percent of the interest due on the portion of the underpayment attributable to negligence or intentional disregard of rules or regulations. Negligence is defined to include “any failure to reasonably comply with the Tax Code, including the lack of due care or the failure to do what a reasonable or ordinarily prudent person would do under the circumstances.” Merino v. Commissioner, 196 F.3d 147, 154 (3d Cir. 1999) (quoting Heasley v. Commissioner, 902 F.2d 380, 383 (5th Cir. 1990)), affg. T.C. Memo. 1997-385. Petitioners’ primary argument is that they were not negligent because they relied on advice from Mr. Trimboli. Reasonable reliance on professional advice may be a defense toPage: 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