- 8 -
Cir. 1990), affd. 501 U.S. 868 (1991). Reliance on a
professional adviser, standing alone, is not an absolute defense
to negligence; it is only one factor to be considered. In order
for reliance on a professional adviser to relieve a taxpayer from
the negligence penalty, the taxpayer must establish that the
professional adviser on whom he or she relied had the expertise
and knowledge of the relevant facts to provide informed advice on
the subject matter. Freytag v. Commissioner, supra at 888.
Petitioner made no effort to ascertain the professional
background and qualifications of his return preparer, Mr.
Beltran. He failed to examine the returns prepared by Mr.
Beltran, except to ascertain the amount of the refunds he could
expect. Petitioner did not look beyond that, as he was obviously
interested more in the recommendation he had received on Mr.
Beltran that he was a "good guy" and "can certainly save you a
lot of money." The Court is satisfied that petitioner knew that
he could only claim deductions that could be substantiated, and,
when his returns reflected refunds considerably higher than what
he normally would have received, his failure to examine the
returns or to have someone examine the returns for him to
ascertain the reasons for such overpayments, constitutes
negligence or disregard of rules or regulations. Petitioner
consciously failed to examine the returns because he knew that
the returns must have contained information that was false. With
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: May 25, 2011