- 32 -
have failed to substantiate casualty losses greater than the
amounts conceded by respondent, and we sustain that portion of
respondent's determination that has not been conceded.
Accuracy-Related Penalties
Respondent determined that petitioners were liable for the
accuracy-related penalty based on a substantial understatement of
income tax, or alternatively, negligence or disregard of rules or
regulations, for 1997 and 1999. Sec. 6662(a) and (b)(1) and (2).
Respondent also determined that petitioners were liable for the
accuracy-related penalty based on negligence or disregard of
rules or regulations for 2000. Sec. 6662(a) and (b)(1).
A "substantial understatement" exists for this purpose if
the amount of tax required to be shown on the return exceeds that
shown by the greater of 10 percent of the tax required to be
shown or $5,000. Sec. 6662(d). "Negligence" for purposes of
section 6662 includes any failure to make a reasonable attempt to
comply with the provisions of the internal revenue laws or to
exercise ordinary and reasonable care in the preparation of a tax
return. Sec. 6662(c); sec. 1.6662-3(b)(1), Income Tax Regs.
Only one accuracy-related penalty may be imposed with
respect to any given portion of an underpayment, even if that
portion is attributable to more than one of the types of
misconduct listed in section 6662(b). Jaroff v. Commissioner,
T.C. Memo. 2004-276; sec. 1.6662-2(c), Income Tax Regs.
Page: Previous 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 NextLast modified: May 25, 2011