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the ownership test. See sec. 448(d)(2)(B)(i); sec. 1.448-
1T(e)(5)(i)(A), Temporary Income Tax Regs., 52 Fed. Reg. 22768
(June 16, 1987), as amended by T.D. 8329, 56 Fed. Reg. 485 (Jan.
7, 1997), and T.D. 8514, 58 Fed. Reg. 68299 (Dec. 27, 1993).
Accordingly, we hold that petitioner is a qualified personal
service corporation under section 448(d)(2) and is subject to the
flat 35-percent tax rate for the years in issue.
C. Addition to Tax
Section 6651(a)(1) imposes an addition to tax for failure to
file a return by its due date. Sec. 6651(a)(1). The addition
equals 5 percent for each month or fraction thereof that the
return is late, not to exceed 25 percent. Id. Respondent bears
the burden of production with respect to the addition to tax.
See sec. 7491(c); see also, e.g., Swain v. Commissioner, 118 T.C.
358, 363 (2002); Higbee v. Commissioner, 116 T.C. 438 (2001).
Respondent has met his burden.
In the absence of an extension, the last date for petitioner
to file its calendar year 2002 return was March 17, 2003. Secs.
6072(b), 7503. Ms. Felton claims to have filed an extension
request, but petitioner has been unable to produce any evidence
that such a request was sent to the IRS. Instead of a retained
copy, Ms. Felton proffered a “simulated” copy of the extension
request filled out on or about March 7, 2006, to demonstrate what
petitioner’s extension request would have looked like had one
been submitted in 2003.
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