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come forward with persuasive evidence that the Commissioner’s
determination is incorrect. Rule 142(a); see Higbee v.
Commissioner, supra at 447. The taxpayer may meet this burden by
proving that he or she acted with reasonable cause and in good
faith. See sec. 6664(c)(1); see also Higbee v. Commissioner,
supra at 448; sec. 1.6664-4(b)(1), Income Tax Regs.
Respondent has met his burden of production under section
7491(c). Petitioner’s 2003 return contains an understatement of
tax greater than $5,000 (which is greater than 10 percent of the
amount of tax required to be shown on the return). See sec.
6662(d)(1)(A)(ii). Accordingly, petitioner bears the burden of
proving that the accuracy-related penalty should not be imposed
with respect to any portion of the underpayment for which he acted
with reasonable cause and in good faith. See sec. 6664(c)(1);
Higbee v. Commissioner, supra at 446. Petitioner did not carry
his burden of showing that his omissions from income which
resulted in the underpayment were made with reasonable cause and
in good faith. Accordingly, petitioner is liable for the section
6662(a) penalty.
Decision will be entered
under Rule 155.
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Last modified: November 10, 2007