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of a reasonable attempt to comply with the rules and/or
regulations. Therefore, under section 6662(b)(1), that part of
the underpayment attributable to these disallowed deductions is
subject to the section 6662(a) penalty even if the parties’ Rule
155 computation establishes that there was not a substantial
understatement of income tax.
Petitioner claimed a deduction for charitable contributions
of property in excess of the $500 we found to be the value of the
contributed property. Again, independently of the outcome of the
parties’ Rule 155 computation, that part of the underpayment
attributable to this substantial valuation misstatement is
subject to the section 6662(a) penalty under section 6662(b)(3).
To reflect the foregoing and concessions by the parties,
Decision will be entered
under Rule 155.
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Last modified: November 10, 2007