John Parks Trowbridge - Page 20

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          purposes by any allowable credit for wage withholding, is less              
          than $500.8  Sec. 6654(e)(1).  Second, the addition is not                  
          applicable if the individual’s tax for the preceding taxable year           
          was zero.  Sec. 6654(e)(2).                                                 
               D.  Section 7491(c)                                                    
               Section 7491(c) imposes the burden of production in any                
          court proceeding (i.e., the burden of moving forward with                   
          evidence) on the Commissioner with respect to the liability of              
          any individual for penalties and additions to tax.9  In order to            
          meet the burden of production under section 7491(c), the                    
          Commissioner need only make a prima facie case that imposition of           
          the penalty or addition to tax is appropriate; he need not negate           
          the existence of any circumstantial defense such as reasonable              
          cause.  Higbee v. Commissioner, 116 T.C. 438, 446 (2001); H.                
          Conf. Rept. 105-599, at 241 (1998), 1998-3 C.B. 747, 995.                   
          Furthermore, section 7491(c) has no effect on the burden of proof           
          (i.e., the burden of persuasion), Higbee v. Commissioner, supra             
          at 446-447, which remains on petitioners in these cases, Rule               

               8  Effective for taxable years beginning after Dec. 31,                
          1997, the threshold amount is $1,000.  Taxpayer Relief Act of               
          1997, Pub. L. 105-34, sec. 1202(a), 111 Stat. 994.                          
               9  Sec. 7491(c) applies to court proceedings arising in                
          connection with examinations commencing after July 22, 1998.                
          Internal Revenue Service Restructuring and Reform Act of 1998,              
          Pub. L. 105-206, sec. 3001(c)(1), 112 Stat. 727.  As referenced             
          in our findings of fact, the additions to tax not included in the           
          default motions (collectively, the remaining additions to tax)              
          pertain to examinations commenced after July 1998.                          

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