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all the facts and circumstances, including the experience,
knowledge, and education of the taxpayer.” Sec. 1.6664-4(b)(1),
Income Tax Regs. The most important factor is the extent of the
taxpayer’s effort to assess the proper tax liability.
Stubblefield v. Commissioner, supra; sec. 1.6664-4(b)(1), Income
Tax Regs.
With respect to the unreported State income tax refund,
petitioners acknowledge receipt of this income and that it was
“mistakenly” omitted from their 2002 tax return. Petitioners did
not attempt to explain the reason for the omission. We conclude
that respondent has met his burden of production and that
petitioners have not shown reasonable cause for their failure to
report this item.
With respect to the self-employment income, petitioners did
not receive the Form 1099-MISC, which was sent to their former
address. We have held that failure to receive a Form 1099-MISC
does not necessarily constitute reasonable cause for failure to
report income. See Goode v. Commissioner, T.C. Memo. 2006-48;
Brunsman v. Commissioner, T.C. Memo. 2003-291 (taxpayer “did not
need to receive a Form 1099-MISC to be alerted to the fact that
he received compensation from * * * [a third party] for his
services.”). In this case, however, we find it significant that
petitioners received a Form W-2 from MetLife. Petitioners may
not have understood the distinction between wage income and self-
employment income; i.e., that they should have received a Form
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