- 42 -
Estate of Young v. Commissioner, 110 T.C. 297, 317 (1998); Am.
Props., Inc. v. Commissioner, supra; secs. 1.6662-3(a),
1.6664-4(a), Income Tax Regs. In order to so qualify, a taxpayer
must prove by a preponderance of the evidence that (i) the
adviser was a competent professional who had sufficient expertise
to justify the taxpayer’s reliance on him, (ii) the taxpayer
provided necessary and accurate information to the adviser, and
(iii) the taxpayer actually relied in good faith on the adviser’s
judgment. Neonatology Associates, P.A. v. Commissioner, 115 T.C.
43, 99 (2000), affd. 299 F.3d 221 (3d Cir. 2002); Sklar,
Greenstein & Scheer, P.C. v. Commissioner, 113 T.C. 135, 144-145
(1999).
Petitioners hired Dickson because NTS recommended him for
his knowledge of complex trusts. Petitioners introduced no
evidence regarding Dickson’s credentials or his knowledge and
experience in preparing tax returns or analyzing trust
arrangements for Federal income tax purposes. Dickson was not
called as a witness in the trial of these cases. In short,
petitioners failed to prove that Dickson was a competent tax
adviser and that petitioners were justified in relying on him.
See Ewing v. Commissioner, 91 T.C. 396, 423, (1988), affd.
without published opinion sub nom. Toll v. Commissioner, 940 F.2d
1536 (9th Cir. 1991); Bowen v. Commissioner, T.C. Memo. 2001-47;
sec. 1.6664-4(b), Income Tax Regs.
Page: Previous 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 NextLast modified: May 25, 2011