Alex and Tonja Oria - Page 11




                                       - 11 -                                         
          cause and good faith exception.  United States v. Boyle, supra at           
          250-251; Weis v. Commissioner, 94 T.C. 473, 487 (1990).  However,           
          reliance on the advice of a professional tax adviser does not               
          necessarily demonstrate reasonable cause and good faith.  Sec.              
          1.6664-4(b)(1), Income Tax Regs.  All facts and circumstances               
          must be taken into account.  Sec. 1.6664-4(c)(1), Income Tax                
          Regs.  The advice must be based upon all pertinent facts and the            
          applicable law.  Sec. 1.6664-4(c)(1)(i), Income Tax Regs.  The              
          advice must not be based on unreasonable factual or legal                   
          assumptions.  Sec. 1.6664-4(c)(1)(ii), Income Tax Regs.  The                
          advice cannot be based on an assumption that the taxpayer knows,            
          or has reason to know, is unlikely to be true.  Id.                         
               At the close of the trial of this case, the Court instructed           
          petitioners to address on brief the particular advice from Mr.              
          Loeser on which they were relying to show reasonable cause and              
          good faith with respect to each of the conceded items of                    
          underreported taxable income.  In their briefs, petitioners                 
          address only the transaction involving the fictitious payments to           
          Mr. Loeser or one of his affiliates and resulting in the                    
          erroneous credits to Mr. Oria’s drawing account.  We assume,                
          therefore, that they concede their reasonable cause and good                
          faith defense with respect to the remaining conceded items of               
          underreported taxable income.  Mendes v. Commissioner, 121 T.C.             
          308, 312-313 (2003) (“If an argument is not pursued on brief, we            
          may conclude that it has been abandoned.”).                                 







Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  Next 

Last modified: November 10, 2007