Daniel F. Monte - Page 12

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          Petitioner never received any Forms 1099 for 2000 from First                
          Albany pertaining to the education accounts.  It was not                    
          unreasonable for petitioner to assume that there were no Forms              
          1099 issued for 2000 for which he would be responsible for                  
          reporting on his 2000 return because, after making repeated                 
          requests, he never received any Forms 1099 from either his former           
          spouse or First Albany.  In addition, it was not unreasonable for           
          petitioner to assume that a trust had been established pursuant             
          to the property settlement and separation agreement, and that, if           
          there was any income, the trust would have been responsible for             
          reporting that income on the trust’s income tax return.                     
               Upon a review of the record, we find that petitioner had               
          reasonable cause to believe that there were no Forms 1099                   
          pertaining to him, and that he acted in good faith with respect             
          to the understatement attributable to the income reported on                
          those forms.                                                                
                                     Conclusion                                       
               In view of the foregoing, we hold that petitioner is not               
          liable for the accuracy-related penalty pursuant to section 6662.           
               We have considered all of the arguments made by respondent,            
          and, to the extent that we have not specifically addressed those            
          arguments, we conclude that they are unconvincing.                          
               Reviewed and adopted as the report of the Small Tax Case               
          Division.                                                                   






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