-10- 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 hePage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 Next
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