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Respondent determined a deficiency in petitioner’s Federal
income tax of $2,958 and an accuracy-related penalty pursuant to
section 6662(a) and (b)(1) for the taxable year 2000.
The issues for decision are: (1) Whether petitioner had
unreported tip income during taxable year 2000; and (2) whether
petitioner is liable for the accuracy-related penalty pursuant to
section 6662(a) and (b)(1) for the taxable year 2000.
Background
Some of the facts have been stipulated and are so found.
The stipulation of facts and the attached exhibits are
incorporated herein by this reference. Petitioner resided in
Deerfield Beach, Florida, on the date the petition was filed in
this case.
During taxable year 2000, petitioner was employed as a room
service food server by the Las Vegas Hilton (Hilton).
On July 1, 1992, pursuant to section 7121, the Hilton and
the Commissioner of the Internal Revenue Service entered into a
closing agreement in the form of a Tip Compliance Program “to
ensure maximum compliance by the employees of the Employer
[Hilton] with those provisions of the Internal Revenue Code of
1986 * * *”. The Tip Compliance Program Agreement states as
follows, in pertinent part:
WHEREAS, by law, all employees who receive tips are
required to keep timely and accurate records of tips
received and to report the tips received to their employer
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