-13-
$5,000 or 10 percent of the tax required to be shown on his
return.
Year Tax Reported Required Tax Understatement
1999 $11,392 $24,161 $12,769
2000 13,101 22,604 9,503
2001 8,643 29,455 20,812
The accuracy-related penalty under section 6662(a) does not
apply to any portion of an underpayment, however, if it is shown
that there was reasonable cause for the taxpayer’s position and
that the taxpayer acted in good faith with respect to that
portion. Sec. 6664(c)(1); sec. 1.6664-4(b), Income Tax Regs.
The determination of whether a taxpayer acted with reasonable
cause and good faith is made on a case-by-case basis, taking into
account all the pertinent facts and circumstances, including the
taxpayer’s efforts to assess his or her proper tax liability and
the knowledge and experience of the taxpayer. Sec. 1.6664-
4(b)(1), Income Tax Regs.
While the Commissioner bears the burden of production under
section 7491(c), the taxpayer bears the burden of proof with
respect to reasonable cause. Higbee v. Commissioner, supra at
446.
Petitioner failed to report his income from the tribe for
his services as a tribal council member in 1999 and 2000, claimed
an unexplained adjustment to gross income in 2001, and failed to
substantiate deductions he claimed on brief. Petitioner also
failed to present any evidence showing that his substantial
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