- 19 - with reasonable cause and in good faith. Sec. 6664(c)(1). The decision as to whether the taxpayer acted with reasonable cause and in good faith depends upon all the pertinent facts and circumstances. Sec. 1.6664-4(b)(1), Income Tax Regs. Relevant factors include the taxpayer’s efforts to assess his proper tax liability, including the taxpayer’s reasonable and good faith reliance on the advice of a professional such as an accountant. Id. Further, an honest misunderstanding of fact or law that is reasonable in light of the experience, knowledge, and education of the taxpayer may indicate reasonable cause and good faith. See Furnish v. Commissioner, T.C. Memo. 2001-286; Remy v. Commissioner, T.C. Memo. 1997-72. At trial, petitioner testified that he provided his accountants (Accufast for 1993 and 1994, and J.E. & Assoc. for 1995) with all of his business records, receipts, and check stubs. In this regard, petitioner testified: I had an accountant that takes care of all this stuff, so I really don’t understand it, don’t know what it is. You know, he had all the records and took care of all that stuff, as far as what the rent was and how much was paid, and the materials, supplies and stuff. * * * As far as * * * the charges and stuff * * * he had the records, the check stubs and all that, and he figured out what was there * * *. Petitioner further testified that he tried to obtain his business records and any substantiating documentation from Accufast for 1993 and 1994 but was told that clients’ records were not retained after 5 years. Moreover, petitioner stated that uponPage: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Next
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