- 12 - preparation of a tax return.” Sec. 1.6662-3(b)(1), Income Tax Regs.; see sec. 6662(c). Furthermore, “any failure by the taxpayer to keep adequate books and records or to substantiate items properly” also constitutes “negligence”. Sec. 1.6662- 3(b)(1), Income Tax Regs. The section 6662(a) accuracy-related penalty does not apply if the taxpayer demonstrates that there was a reasonable cause for the underpayment and that the taxpayer acted in good faith with regard to the underpayment. Sec. 6664(c)(1); sec. 1.6664-4(a), Income Tax Regs. The applicability of this exception is made on a case-by-case basis and depends upon all of the pertinent facts and circumstances, such as whether the taxpayer made efforts to assess his proper tax liability and whether there was an honest misunderstanding of fact or law that is reasonable in light of the experience, knowledge, and education of the taxpayer. Higbee v. Commissioner, 116 T.C. 438, 448 (2001); sec. 1.6664-4(b)(1), Income Tax Regs. The charitable contribution deduction claimed on petitioner’s return consists of the following three components: (1) Cash donations, (2) donations of property, and (3) a carryover from a prior year. Petitioner failed to produce sufficient substantiating evidence to support the amount claimed for cash contributions and produced nothing with respect to thePage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Next
Last modified: May 25, 2011