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Petitioner’s attempt to cloak his argument of reasonable
cause in the initial Murphy decision is also unpersuasive.
First, as discussed above, the Court of Appeals for the D.C.
Circuit vacated its initial decision and has since determined
that damages for emotional distress are gross income. Further,
there is no evidence before the Court that petitioner performed
an analysis similar to that of the D.C. Circuit, nor that he
received any advice from a competent tax professional, at the
time he chose not to file a return for 2001.
We find that petitioner has failed to meet his burden of
demonstrating that his failure to file a return was due to
reasonable cause and not willful neglect. Thus, petitioner is
liable for the addition to tax for failure to file under section
6651(a)(1).
Respondent also determined that petitioner is liable for an
addition to tax under section 6654(a) for failure to make
estimated tax payments for 2001. A taxpayer has an obligation to
pay estimated tax for a particular year only if he has a
“required annual payment” for that year. Sec. 6654(d). A
“required annual payment” is equal to the lesser of (1) 90
percent of the tax shown on the individual’s return for that year
(or, if no return is filed, 90 percent of his or her tax for such
year), or (2) if the individual filed a return for the
immediately preceding taxable year, 100 percent of the tax shown
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