-266-
Section 7491(c), if applicable, imposes upon the
Commissioner only the burden of production with respect to
penalties, and not the burden of proof as petitioner suggests.188
See Higbee v. Commissioner, 116 T.C. 438, 446 (2001). Moreover,
by its terms, section 7491(c) applies only with respect to the
liability for penalties of any “individual”. By contrast,
section 7491(a), which provides the general rule for shifting the
burden of proof to the Commissioner in certain circumstances,
applies in ascertaining the liability of a “taxpayer”. Plainly,
by using the different terms “individual” and “taxpayer”,
Congress intended to distinguish the two terms. See sec.
7701(a)(14) (defining the term “taxpayer” to mean any person
subject to any internal revenue tax) and (a)(1) (defining the
term “person” to mean and include an individual, a trust, estate,
partnership, association, company, or corporation); see also sec.
7491(b) (limiting its application to an “individual taxpayer”);
cf. Elec. Arts, Inc. v. Commissioner, 118 T.C. 226, 258 (2002)
(“Ordinarily, in statutes and other legal documents, it is
presumed that if the drafter * * * varies the terminology, then
the drafter intends that the meaning also varies.”).
188 This burden of production, if applicable, requires the
Commissioner to “initially come forward with evidence that it is
appropriate to apply a particular penalty to the taxpayer”. H.
Conf. Rept. 105-599, at 241 (1998), 1998-3 C.B. 747, 995. This
provision is not intended, however, to require the Commissioner
to introduce evidence regarding reasonable cause, substantial
authority, or similar provisions. Id.
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