- 8 - D. Whether Petitioners May Deduct Partnership Losses of $32,065 for 2001 Petitioners contend that they may deduct partnership losses of $32,065 for 2001. We disagree. There is no evidence to support petitioners’ partnership loss deduction for 2001. E. Whether Petitioners Are Liable for the Accuracy-Related Penalty Section 7491(c) places on the Commissioner the burden of producing evidence that it is appropriate to impose additions to tax. To meet this burden, the Commissioner must produce evidence showing that it is appropriate to impose the particular addition to tax but need not produce evidence relating to defenses such as reasonable cause or substantial authority. Higbee v. Commissioner, 116 T.C. 438, 446 (2001); H. Conf. Rept. 105-599, at 241 (1998), 1998-3 C.B. 747, 995. Petitioners failed to keep records and substantiate their deductions. Petitioners offered no evidence to show that they are entitled to NOLs or partnership losses or other claimed deductions. Thus, respondent has met the burden of production, and petitioners are liable for the accuracy-related penalty for 2000 and 2001. F. Penalty for Frivolous Positions or Instituting Proceedings Primarily for Delay Under Section 6673 Respondent moved at trial to impose a penalty under section 6673. The Court may impose a penalty of up to $25,000 if the position or positions asserted by the taxpayer in the case arePage: Previous 1 2 3 4 5 6 7 8 9 Next
Last modified: May 25, 2011