Frederick C. Kumpel - Page 14

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          payments for secretarial services on his Schedules C suggests an            
          intention to conceal the relationship and the employment tax                
          issue.)  Where, as here, common law factors compel a finding that           
          an employer-employee relationship exists, the parties’ intentions           
          to the contrary will not be given effect.                                   
               8.  Conclusion                                                         
               After considering all of the facts and circumstances in this           
          case, we conclude that both Smith and Mawson were employees of              
          petitioner during the years in issue.                                       
          Additions to Tax                                                            
               Under section 6651, a taxpayer who fails to file timely or             
          fails to pay employment taxes shall be assessed an addition to              
          tax, unless it is shown that the failure is due to reasonable               
          cause and not due to willful neglect.  See Conklin Bros. of Santa           
          Rosa, Inc. v. United States, 986 F.2d 315, 317 (9th Cir. 1993);             
          Charlotte’s Office Boutique v. Commissioner, 121 T.C. ___, ___              
          (2003) (slip op. at 30).  To establish reasonable cause, the                
          taxpayer must show that ordinary business care and prudence were            
          exercised in providing for payment of the tax liability.  Sec.              
          301.6651-1(c)(1) and (2), Proced. & Admin. Regs.  Willful neglect           
          means a “conscious, intentional failure or reckless                         
          indifference.”  United States v. Boyle, 469 U.S. 241, 245-246               
          (1985).                                                                     
               Under section 6656, an addition to tax is imposed equal to             
          10 percent of the portion of an underpayment in tax that is                 





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