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as a “conscious, intentional failure or reckless indifference.”
United States v. Boyle, 469 U.S. 241, 245 (1985).
In the instant case, the record demonstrates that
petitioners maintained business records that ultimately provided
the financial information reported on petitioners’ 2000 and 2001
tax returns. Prior to filing the 2000 tax return, however,
petitioner suffered a debilitating physical ailment, and
petitioner Cynthia A. Burrough Irving suffered a miscarriage. To
access their electronically stored business records and file the
2000 tax return, petitioners sought and received assistance from
their friend, Scott Yusem. Mr. Yusem testified credibly that he
helped petitioners file their tax returns because he “had some
knowledge of accounting from running [his own] business” and
petitioners lacked the resources to hire a professional tax-
preparer. On the basis of the foregoing, we conclude that
petitioners’ delay in filing the 2000 tax return was due to
reasonable cause and not willful neglect. Accordingly, we hold
that petitioners are not liable for the asserted section
6651(a)(1) addition to tax for failure to file timely with
respect to their 2000 tax year.
Section 6662(a) imposes a 20-percent accuracy-related
penalty with respect to the portion of any underpayment of tax
attributable to a substantial understatement of income tax. An
“understatement” is the excess of the amount of tax required to
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