Elizabeth Lai - Page 23

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          proper tax liability, including the taxpayer’s reasonable and               
          good faith reliance on the advice of a professional such as an              
          accountant.  See id.  However, reliance on the advice of a                  
          professional tax advisor does not necessarily establish                     
          reasonable cause and good faith.  Id.  Particularly, reliance on            
          the advice of a tax professional is not reasonable when a                   
          taxpayer fails to disclose a fact that he or she knows, or                  
          reasonably should know, is relevant to the proper tax treatment             
          of an item.  Sec. 1.6664-4(c)(1)(i), Income Tax Regs.                       
               Petitioner has not demonstrated that any of her                        
          underpayments are due to reasonable cause and good faith.                   
          Petitioner did not mention her tip income to Mr. Nguyen during              
          his preparation of petitioner’s income tax returns.  Although               
          petitioner may have believed that tip income was not taxable,               
          that belief is not reasonable.  Petitioner has failed to                    
          demonstrate that she acted with reasonable cause and good faith             
          with regard to any particular portion of the underpayments in               
          this case.  Therefore, to the extent that we uphold respondent’s            
          determination of deficiencies for the years at issue, we conclude           
          that petitioner is liable for the section 6662(a) penalties.                
               To reflect the foregoing,                                              

                                                  Decision will be entered            
                                             under Rule 155.                          

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