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6662(a) and (b)(1). Negligence is defined to include any failure
to make a reasonable attempt to comply with the provisions of the
Internal Revenue Code. Sec. 6662(c). It is further defined as
the failure to do what a reasonable person with ordinary prudence
would do under the same or similar circumstances. Neely v.
Commissioner, 85 T.C. 934, 947 (1985). Disregard is defined to
include any careless, reckless, or intentional disregard. Sec.
6662(c). An accuracy-related penalty will not be imposed with
respect to any portion of an underpayment as to which the
taxpayer acted with reasonable cause and in good faith. Sec.
6664(c)(1). Whether the taxpayer acted with reasonable cause and
in good faith depends on the pertinent facts and circumstances.
Sec. 1.6664-4(b)(1), Income Tax Regs. Generally, an important
factor is the extent of the taxpayer’s effort to properly assess
the tax liability. Circumstances that may indicate reasonable
cause and good faith include and an honest misunderstanding of
fact or law that is reasonable in light of the taxpayer’s
experience, knowledge, and education. Id.
Petitioners’ return for each year in issue was prepared by
petitioner, a practicing attorney. Nothing in the record
suggests that petitioner sought professional guidance or advice
in connection with the preparation of petitioners’ returns.
Petitioner’s profession is relevant in deciding whether
petitioners are liable for a penalty under section 6662(a),
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Last modified: May 25, 2011