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any failure by the taxpayer to keep adequate books and records or
to substantiate items properly.” Sec. 1.6662-3(b)(1), Income Tax
Regs.
An exception to the section 6662(a) penalty is set forth in
section 6664(c)(1) and reads: “No penalty shall be imposed under
this part with respect to any portion of an underpayment if it is
shown that there was a reasonable cause for such portion and that
the taxpayer acted in good faith with respect to such portion.”
Regulations interpreting section 6664(c) state:
The determination of whether a taxpayer acted with
reasonable cause and in good faith is made on a case-
by-case basis, taking into account all pertinent facts
and circumstances. * * * Generally, the most important
factor is the extent of the taxpayer’s effort to assess
the taxpayer’s proper tax liability. * * * [Sec.
1.6664-4(b)(1), Income Tax Regs.]
Reliance upon the advice of a tax professional may, but does
not necessarily, demonstrate reasonable cause and good faith in
the context of the section 6662(a) penalty. Id.; see also United
States v. Boyle, 469 U.S. 241, 251 (1985); Freytag v.
Commissioner, supra at 888. Such reliance is not an absolute
defense, but it is a factor to be considered. Freytag v.
Commissioner, supra at 888.
In order for this factor to be given dispositive weight, the
taxpayer claiming reliance on a professional must show, at
minimum: “(1) The adviser was a competent professional who had
sufficient expertise to justify reliance, (2) the taxpayer
provided necessary and accurate information to the adviser, and
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