Paul E. Ballmer - Page 11

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          on that return.  Sec. 6654(d)(1); Wheeler v. Commissioner, 127              
          T.C. 200, 210-212 (2006); Heers v. Commissioner, T.C. Memo.                 
          2007-10.  The addition to tax is not applicable if the taxpayer’s           
          liability for the preceding taxable year was zero.  Sec.                    
               Respondent introduced evidence to show petitioner was                  
          required to file a return for 2001 and failed to do so and that             
          petitioner failed to make any estimated tax payments for 2001.              
          The parties agree that petitioner did not file a return for the             
          2000 tax year.  Thus, respondent has met his burden of production           
          with respect to the addition to tax under section 6654(a).                  
               Petitioner, however, maintains that he did not have any                
          liability for the 2000 tax year and thus was not required to make           
          estimated tax payments for the 2001 tax year.  In prior years               
          when petitioner did not file a return and respondent received               
          information concerning petitioner’s income, respondent prepared             
          substitutes for returns and sought to collect the determined                
          liabilities.  The fact that respondent did not file a substitute            
          for return or seek to collect payment for 2000 supports                     
          petitioner’s position that he did not have any liability for                

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Last modified: November 10, 2007