§666 — Accumulation distribution allocated to preceding years

2009-265, but those cases are distinguishable . Petitioner has asserted partner- level defenses to the sec . 6662 accuracy-related penalty that depend on factual findings at the partner level .

Accordingly, we find it premature to rule at this time that the valuation misstatement penalty under section 6662(h) does not apply .

§ 1366(a) (providing that an S corporation shareholder shall take into account his pro rata share of, among other things, the corporation’s loss for the tax year).13 Even if we assume that HCM was entitled to claim a deduction for the asset seizures (a question we need not decide here), Mr.

Bailey makes no contention as to "reasonable cause" for the 1999 or 2000 return, and we hold that for those two years he is liable for the addition to tax under section 6651(a)(1).

Bailey makes no contention as to "reasonable cause" for the 1999 or 2000 return, and we hold that for those two years he is liable for the addition to tax under section 6651(a)(1).

Lovett for tax year 2006, pursuant to section 6662 (a) .

We hold that ee should.

We hold that she is liable for the fraud penalty for each year but in amounts less than the IRS.

Accordingly, we hold hat petitioner was required and'faile d to report $73,625 of interbst'income for 2006 .

Accordingly, we hold that respondent correctly applied section 183 by allowin g expense deductions only to the extent of petitioners' income from 'charter fishing .

Consequently, we hold that foreach of the years in issue petitioner is, required to include"the gambling winnings in gross income and is not entitled to any deduction for losses.

Based on the record, we hold that respondent has satisfied the burden with respect to the - 15 - section 6662(a) accuracy-related penalty for the reasons discussed hereinafter .

I suggest thát "responderit - 36 - finds the - statutory hook fo his regulatory innovation not in section 6664 (a) (1) (A) , whose plain meaning, as Judge Gustafson points out,- could hardly be clearer, but instead in section 6664 (a) (1) (B),. A. Section 6664 (a) (1) (B) , Not Section 6664 (a) (1) (A) , Turns the Key ,Section 6664 (a),(1) (A) plicates the operative language of section 6211(a) (1) (A) , the p rallel provision in the definition of deficiency ("the amount shown as the tax by the

6662(d) (1) (A) . As pertinent here, in the case of a corporatior other than"an S corporation, an understatement is substanti 1 (1) for taxable years that began on or before October 22, 2004, if it exceeds the greater=of 10 - percent of the - tax required to be shown in the tax return for the taxable year or $10, 000, se . 6662 (d) (1).(B) , and (2) for taxable years that began'after October 22, 2004, if it exceeds the lesser of (a) 10 percent of the tax -required to be shown in the tax return f

Valuation Misstatement Penalty Respondent argues that petitioner is liable for either a substantial or gross valuation penalty pursuant to section 6662(b)(3) and (e) or (h) . Section 6662(b)(3) imposes a 20- percent penalty on that portion of an underpayment which results from a substantial valuation misstatement . There is a substantial valuation misstatement if the value of any property claimed on the return is 200 percent or more of the amount determined to be the correct amount . Sec . 6662(

Klaas is not liable for the section 6663 fraud penalty for 2001 . IV. Negligence Penalty Under Section 6662(a ) As an alternative to the fraud penalty, respondent determined that petitioners are liable for a section 6662(a) accuracy-related penalty for 2001 on account of their failure to report the gain on the sale of Silver Spur . Section 6662(a) and (b)(1) and (2) imposes a 20-percent penalty on an underpayment of tax that results from negligence or disregard of rules and regulations or from a

This is the same as his burdenunder section 666 to prove applicability ofthe civil fraud penalty (which is also at issue).

[*29] In light ofthe complex nature oftlhe transaction before us, the difficult tax issues presented, and the testimony and t ial record before us, we exercise our discretion not to sustain the section 666 (a) penalties respondent determined.

[*29] In light ofthe complex nature oftlhe transaction before us, the difficult tax issues presented, and the testimony and t ial record before us, we exercise our discretion not to sustain the section 666 (a) penalties respondent determined.

Section 666-2(a) and (b) (1) imposes, a penalty of 20 percent on that portion of an underpayment of tax that is attributable to negligence or disregard of rules of regulations. Generally, no penalty shall be imposed under section 6662 with respect to any portion of an underpayment if with respect to such portion it is shown that there was reasonabl

McGehee Family°'Clinic'and December 31, 2004, <for, the Prossers Thus, at the time that .petitioners were deciding, on the tax treatment-'of-,contributions to -Benistar Plan, for.the {years atr :issue, section 666.2A had already been--enacted .

taken- into account-., -,:They'are not :liable .for ,tYie'section 666.2 (a).^ accuracy- related`>penalty .for ahy.,year.

Respondent also determined that petitioner was liable for the section 666 3 fraud penalty.

Accuracy-Related Penalty Under Section 666 2 Respondent contends that petitioners are liable for the accuracy-related penalty under section 6662'for all years at issue .

, Section~6664(c)(1) provides .an exception to the section 666.2(a) penalty : no'penalty is,.,imposed with respect to any .

Accuracy-Related Penalty Under Section 666 2 Respondent contends that petitioners are liable for the accuracy-related penalty on the grounds of (1) negligence or disregard of rules or regulations under section 6662(a) and (b)(1) for 2003 and (2) negligence or disregard of rules o r 13we remind the parties that when making their Rule 155 calculations, miscellaneous itemized deduc

666 (bribery), 18 U.S.C. sec. 844(i) (arson), 18 U.S.C. sec. 1344 (bank fraud) and 26 U.S.C. sec. 7201 (income tax evasion). The U.S. Attorney further charged petitioner in the superseding 2Petitioner concedes all the determinations in the notice of deficiency. - 3 - information as follows: 1. From on or about April 8, 1991 through April 11,

We uphold the imposition of the accuracy-related penalties under section 666.2(a) for the underpayments of the 1994 and 1995 tax liabilities.

666, and one count of income tax evasion for the tax year 1988, in violation of section 7201. - 13 - Ms. Dawson was sentenced to 28 months’ incarceration in Federal prison. At the time of trial, Ms. Dawson was on supervised release from Federal prison. She was ordered by the District Court to pay, and, at the time of trial, she was paying, (1