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attempt to comply with the provisions of the Internal Revenue
Code and any failure to exercise ordinary and reasonable care in
the preparation of a tax return. Sec. 6662(c); ASAT, Inc. v.
Commissioner, 108 T.C. 147, 175 (1997); sec. 1.6662-3(b)(1),
Income Tax Regs. An accuracy-related penalty under section
6662(a) does not apply to any part of an underpayment if the
taxpayer shows that there was reasonable cause for that part and
that the taxpayer acted in good faith. Sec. 6664(c)(1).
Petitioner’s failure to report any income and reliance on
frivolous arguments are not what a reasonable and prudent person
would do under the circumstances. We sustain respondent’s
determination as to this issue.
E. Penalty Under Section 6673(a)
Respondent moved the Court to impose a penalty under section
6673(a). Respondent asserts that petitioner’s position in this
case is frivolous and groundless. Respondent also asserts that
petitioner instituted this proceeding primarily for the purpose
of delay.
Section 6673(a)(1) authorizes the Court to require a
taxpayer to pay to the United States a penalty of up to $25,000
whenever it appears that proceedings have been instituted or
maintained by the taxpayer primarily for delay or that the
taxpayer’s position in the proceeding is frivolous or groundless.
Petitioner did not offer any evidence at trial, nor did he
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