John A. Seavey - Page 8

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               Section 6651(a)(1) imposes an addition to tax for failure to           
          file a Federal income tax return by its due date, determined with           
          regard to any extension of time for filing previously granted.              
          The addition to tax equals 5 percent for each month that the                
          return is late, not to exceed 25 percent.  Sec. 6651(a)(1).                 
               Section 6651(a)(2) provides for an addition to tax for                 
          failure to pay taxes shown on a return on or before the payment             
          due date.  The addition to tax is one-half percent of the amount            
          shown as tax on a return for each month or fraction thereof                 
          during which the failure to pay continues, not exceeding 25                 
          percent in the aggregate.  Sec. 6651(a)(2).                                 
               The additions to tax under section 6651(a)(1) and (2) do not           
          apply, however, if the failure is due to reasonable cause and not           
          due to willful neglect.  United States v. Boyle, 469 U.S. 241,              
          245 (1985); Jackson v. Commissioner, 864 F.2d 1521, 1527 (10th              
          Cir. 1989), affg. 86 T.C. 492 (1986); Crocker v. Commissioner, 92           
          T.C. 899, 912 (1989).  "Reasonable cause" requires the taxpayer             
          to demonstrate that he exercised ordinary business care and                 
          prudence.  United States v. Boyle, supra at 246.  "Willful                  
          neglect" is defined as a "conscious, intentional failure or                 
          reckless indifference."  Id. at 245.                                        
               Petitioner agrees that his return for 1992 was not filed               
          timely and that he has not fully paid his tax liabilities shown             
          as due on the returns for the 3 subject years.  Petitioner has              






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