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amounts that should have been assessed as deficiencies related
thereto, to reflect his recent finding that the aforementioned
decisions increased petitioner’s income in the respective years
only by $28,059 and $100,226.5 On October 25, 2004, respondent
abated $1,369 and $23 of the assessed computational adjustments
for 1989 and 1991, respectively, thus reducing the assessed
amounts to $7,574 and $28,324, respectively. Those reductions
led to respondent’s allegation in the answer that the accuracy-
related penalties for 1989 and 1991 equal $3,029.60 and
$5,664.80, respectively ($7,574 x .40 = $3,029.60; $28,324 x .20
= $5,664.80).
OPINION
1. Burden of Production
Petitioner argues that section 7491(c) applies to place upon
respondent the burden of production as to the accuracy-related
penalties.6 Section 7491(c) was added to the Code by the
5 The letters also explained that respondent was reducing
petitioner’s self-employment tax for 1991 to reflect a correction
made in the calculation of self-employment income.
6 Sec. 7491(c) provides:
SEC. 7491(c). Penalties.--Notwithstanding any
other provision of this title, the Secretary shall have
the burden of production in any court proceeding with
respect to the liability of any individual for any
penalty, addition to tax, or additional amount imposed
by this title.
In order for the Commissioner to satisfy that burden of
(continued...)
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