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Memo. 1983-684. Thus, we sustain respondent’s determination that
petitioner’s wages constitute gross income under section 61(a).
2. Additions to Tax
a. Section 6651
Respondent determined that petitioner is liable for
additions to tax for: (1) Failure to file a timely return for
taxable year 2001 pursuant to section 6651(a)(1); and (2) failure
to file a timely return for taxable year 2002 pursuant to section
6651(a)(1).
Section 6651(a)(1) imposes an addition to tax for failure to
timely file a tax return. The addition to tax is equal to 5
percent of the amount of the tax required to be shown on the
return if the failure to file is not for more than 1 month. See
sec. 6651(a)(1). An additional 5 percent is imposed for each
month or fraction thereof in which the failure to file continues,
to a maximum of 25 percent of the tax. See id. Section
6651(a)(2) provides for an addition to tax of 0.5 percent per
month, up to 25 percent, for failure to pay the amount shown or
required to be shown on a return. A taxpayer may be subject to
both paragraphs (1) and (2), in which case the amount of the
addition to tax under section 6651(a)(1) is reduced by the amount
of the addition to tax under section 6651(a)(2) for any month to
which an addition to tax applies under both paragraphs (1) and
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