- 16 -
Cheshire I, supra at 199; see also Rowe v. Commissioner, supra.
Section 6662(a) imposes a 20-percent penalty on the portion
of an underpayment attributable to any one of various factors,
one of which is negligence or disregard of rules or regulations.
Sec. 6662(b)(1). Respondent determined that petitioner and Mr.
Elesh were jointly and severally liable for the penalty for an
underpayment equal to the total amount of the deficiency in each
year in issue.
“Negligence” includes any failure to make a reasonable
attempt to comply with the provisions of the Internal Revenue
Code. Sec. 6662(c); sec. 1.6662-3(b)(1), Income Tax Regs.
Section 6664(c)(1) provides that the penalty under section
6662(a) shall not apply to any portion of an underpayment if it
is shown that there was reasonable cause for the taxpayer’s
position and that the taxpayer acted in good faith with respect
to that portion. The determination of whether a taxpayer acted
with reasonable cause and in good faith is made on a case-by-case
basis, taking into account all the pertinent facts and
circumstances. Sec. 1.6664-4(b)(1), Income Tax Regs. The most
important factor is the extent of the taxpayer’s effort to assess
her proper tax liability for the year. Id.
As discussed above, the portion of the deficiencies
attributable to the charitable contribution deductions are to be
allocated to Mr. Elesh for purposes of section 6015(c) relief.
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