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indicating that it is appropriate to impose the relevant penalty”
or addition to tax. Higbee v. Commissioner, 116 T.C. 438, 446
(2001). In instances where an exception to the penalty or
addition to tax is afforded upon a showing of substantial
authority, reasonable cause, or similar provisions, the taxpayer
bears the burden of raising and prevailing on these issues. Id.
at 446-447.
1. Section 6651
Section 6651(a)(1) imposes a 5-percent addition to tax for
each month or portion thereof a required return is filed after
the prescribed due date, not to exceed 25 percent in the
aggregate, unless such failure to file timely is due to
reasonable cause and not due to willful neglect. Although not
defined in the Code, “reasonable cause” is described by the
applicable regulations as the exercise of “ordinary business care
and prudence”. Sec. 301.6651-1(c)(1), Proced. & Admin. Regs; see
also United States v. Boyle, 469 U.S. 241, 246 (1985).
“[W]illful neglect” is interpreted as “a conscious, intentional
failure or reckless indifference.” United States v. Boyle, supra
at 245.
Respondent produced evidence that petitioner failed to file
a Federal income tax return for 2000 and 2001. A Federal income
tax return that contains only zeros and is accompanied by tax-
protester rhetoric is generally not considered a valid return.
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Last modified: May 25, 2011