- 49 -
transaction as a sale in their 1999 return.
Based upon our examination of the entire record before us,
we find that petitioners have failed to carry their burden of
establishing that they are not liable for 1999 for the accuracy-
related penalty under section 6662(a) because of a substantial
understatement of tax under section 6662(b)(2).40
We now address respondent’s determination in the notice that
petitioners are liable for 2000 for the accuracy-related penalty
under section 6662(a). We have found that petitioners have
sustained their burden of establishing by strong proof that
respondent erred in determining that the June 14, 2000 transac-
tion constitutes a sale of lot 12 for $225,000. Consequently,
there is no underpayment of tax for 2000 on which the accuracy-
related penalty under section 6662(a) may be imposed. On the
record before us, we find that petitioners are not liable for
2000 for the accuracy-related penalty.
We have considered all of the contentions and arguments of
the parties that are not discussed herein, and we find them to be
without merit, irrelevant, and/or moot.
40In light of our finding under sec. 6662(a) and (b)(2), we
need not address respondent’s argument that petitioners are
liable for 1999 for the accuracy-related penalty under sec.
6662(a) because of negligence or disregard of rules or regula-
tions under sec. 6662(b)(1).
Page: Previous 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 Next
Last modified: November 10, 2007