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claiming zero tax liability for the current year and refunds for
several prior years. Petitioner did not consult an accountant to
prepare the loss but rather relied on his then wife, Ms. White,
who has no experience in bookkeeping. Ms. White’s analysis
yielded a total of $1,801,213. However, once consulted,
petitioner’s accountant quickly reduced that amount to $704,500.
Accordingly, petitioner does not qualify for the reasonable cause
exception in section 6664(c)(1), and we hold that petitioner is
liable for the penalty pursuant to section 6662 for a substantial
understatement of income tax.
We have considered all of petitioner’s contentions, and, to
the extent they are not discussed herein, they are moot,
irrelevant, or without merit.
To reflect the foregoing,
Decision will be entered
for respondent.
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