T.C. Memo. 1996-260

UNITED STATES TAX COURT

PATRICK W. HEALEY AND NANCY L. MARSHALL, Petitioners v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket Nos. 222-94, 2613-95. Filed June 6, 1996.

 

Patrick W. Healey, for petitioners. 

Lisa K. Hartnett, for respondent. 

MEMORANDUM FINDINGS OF FACT AND OPINION

COLVIN, Judge: Respondent determined that petitioners are

liable for a deficiency in Federal income tax, an addition to

tax, and a penalty as follows:
- 2 -

 Addition to Accuracy-Related

 Tax Penalty 

Year Deficiency Sec. 6651(a)(1) Sec. 6662(a),(c)1

1990 $1,181.38 $6,503.94 $6,607.52

1991 -- 3,375.00 --

1992 -- 2,404.00 --

1 Respondent determined that petitioners were liable for

negligence under sec. 6662(a) and (c), but not substantial

understatement under sec. 6662(d). Thus, we do not consider

whether petitioners are liable under sec. 6662(d). 

After concessions by petitioners, we must decide the

following issues:

1. Whether petitioners' Applications for Automatic

Extension of Time to File U.S. Individual Income Tax Return

(Forms 4868) for the years in issue are valid. We hold that they

are not, because petitioners did not properly estimate their tax

liability. 

2. Whether petitioners are liable for additions to tax

under section 6651(a)(1) for failure to timely file income tax

returns for 1990, 1991, and 1992. We hold that they are.

3. Whether petitioners are liable for the accuracy-related

penalty under section 6662(a) and (c) for negligence for 1990. 

We hold that they are. 

4. Whether imposition of the additions to tax for failure

to timely file under section 6651(a)(1) and failure to timely pay

under section 6651(a)(2) and the accuracy-related penalty for

negligence under section 6662(a) and (c) for 1990 violates the

Double Jeopardy Clause of the Fifth Amendment to the U.S.
- 3 -

Constitution (Double Jeopardy Clause) or otherwise unlawfully

penalizes petitioners twice for the same conduct. We hold that

it does not.

5. Whether respondent's determination that petitioners are

liable for the addition to tax for failure to timely file under

section 6651(a)(1) for 1991 and 1992 is invalid because

respondent unlawfully selected them for audit. We hold that it

is not. 

6. Whether petitioners have made a prima facie showing

that the addition to tax under section 6651(a)(1) was selectively

applied to them by respondent. We hold that they have not. 

Thus, petitioners are not entitled to discover from respondent

statistics relating to respondent’s application of the addition

to tax under section 6651(a)(1) to other taxpayers.

 References to petitioner are to Patrick W. Healey. 

References to petitioner wife are to Nancy L. Marshall. Section

references are to the Internal Revenue Code in effect for the

years in issue. Rule references are to the Tax Court Rules of

Practice and Procedure.

FINDINGS OF FACT

Some of the facts have been stipulated and are so found.

A. Petitioners

Petitioners are married and lived in Lincoln, Nebraska, when

they filed the petitions in these cases. 
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Petitioner is an attorney and senior partner in the law firm

Healey & Wieland in Lincoln, Nebraska. He has had more than 30

years' experience as an attorney, specializing in litigation. He

was a partner at his law firm during the years in issue. He had

access to all financial records of his law firm. 

Petitioner received draws from his law firm of $106,250 in

1990, $93,000 in 1991, and $144,120 in 1992. Petitioner

entertained clients as part of his business. 

Petitioner reached age 591⁄2 in 1990, which entitled him to

receive a $35,000 distribution from his law firm’s pension fund. 

He received that amount during 1990 and deposited it in his bank

account. Petitioner knew that he was required to report the

$35,000 as income on his tax return. When he prepared his 1990

income tax return in August 1991, he did not remember in which

year he had received the distribution. He did not check his

records to see when he had received it. 

Petitioner wife is an artist, musician, and teacher. She

held shows and entertained clients during the years in issue. 

B. Petitioners’ Application for Extension of Time To File

Income Tax Returns

1. Petitioners' 1990 Tax Year

a. Application for Extension of Time To File

Petitioner’s law firm had not prepared its partnership tax

return for 1990 by April 15, 1991. On April 15, 1991, petitioner

prepared and petitioners filed a Form 4868 in which they
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1 The Forms 4868 that petitioners signed for 1991 and 1992,

discussed below, also contained this language. 

requested a 4-month extension of the time to file their 1990 tax

return.

 The Form 4868 petitioners filed stated:

Total tax liability for 1990. This is the amount you

expect to enter on line 27 of Form 1040A, or line 54 of

Form 1040. If you do not expect to owe tax, enter zero

(-0-) . . . . .

Caution: You MUST enter an amount on line 1 or your

extension will be denied. You can estimate this

amount; but be as exact as you can with the information

you have. If we later find that your estimate was not

reasonable, the extension will be null and void.[1]

Petitioners did not estimate their tax liability for 1990 on

line one of the Form 4868. Petitioners reported that they had

paid estimated taxes of $4,800 and had a balance due of $1,200,

which they paid when they filed the Form 4868. 

b. Petitioners’ Federal Income Tax Return for 1990

Petitioner prepared petitioners’ Federal income tax return

for 1990. Petitioners filed it on August 15, 1991. They

reported that petitioner’s income from his law firm was $110,615

and that petitioners’ tax liability was $18,773.21. They

subtracted their estimated tax payments and the payment they made

with the Form 4868, and reported a balance due of $12,773.21. 

Petitioners deducted $3,580 for meals and entertainment

expenses on their 1990 return. Petitioners did not keep
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contemporaneous records of the business purpose of those

expenses. 

c. Audit of Petitioners’ 1990 Tax Return

Respondent audited petitioners' 1990 return in September

1991. Respondent issued a Request for Payment of $565.56 for

underpayment of estimated tax, $255.46 for late payment of tax,

and $439.59 for interest (a total of $1,260.61) because

petitioners did not pay the amount shown on their return. 

Petitioners then paid those amounts to respondent. Respondent

also made several adjustments to which petitioners agreed. 

Counting those adjustments, petitioners’ 1990 tax liability was

$31,856. 

Petitioners concede that they should have reported that

the $35,000 pension distribution and an additional $5,581 from

petitioner wife's business was income in 1990. Petitioners

concede that they erroneously claimed a dependency exemption

for their daughter, Robin, in 1990, and $22,833 in itemized

deductions for unreimbursed employee expenses and personal

property taxes. After the audit, respondent concluded that

petitioners could deduct $15,316 more in business expenses for

petitioner's law practice than they claimed on their 1990

Schedule E. 

 Petitioners disagreed with respondent's conclusions for

1990 that: (i) They could not deduct $3,580 for meals and
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entertainment expenses due to lack of substantiation; (ii) their

1990 Form 4868 was invalid; and that (iii) they are liable for

the addition to tax for failure to timely file their 1990 return

and the accuracy-related penalty. On December 21, 1992,

petitioners signed a Form 870, Waiver of Restrictions on

Assessment and Collection of Deficiency in Income Tax and

Acceptance of Overassessment for 1990. Respondent referred the

case to respondent's Appeals Office and issued a notice of

deficiency for 1990 on October 8, 1993. Petitioners filed their

petition for 1990 (docket No. 222-94) on January 3, 1994. 

2. Petitioners' 1991 Tax Year

a. Application for Extension of Time To File for 1991

Petitioner prepared and petitioners filed a Form 4868 on

April 15, 1992, seeking to extend the time to file their 1991

return by 4 months to August 17, 1992. On it, petitioners

estimated that their total tax liability for 1991 was $9,800. 

They reported that they had made estimated tax payments of $4,800

and had a balance due of $5,000, which they paid with the Form

4868. 

b. Petitioners’ Federal Income Tax Return for 1991

Petitioner prepared petitioners’ 1991 income tax return. 

Respondent received petitioners' income tax return for 1991 on

August 20, 1992. On that return, petitioners reported that they

received $105,322 in income from petitioner’s law firm and that
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their tax liability was $24,865.52. After subtracting withheld

and estimated tax and tax paid with the Form 4868, they reported

that they had a balance due of $14,849.52, which they paid with

the return. 

Respondent issued a notice of correction of petitioners'

1991 tax return on October 5, 1992, making certain adjustments

and imposing penalties and interest. Petitioners filed an

amended 1991 return on January 29, 1993, on which they reported a

corrected tax liability of $25,118. 

3. Petitioners' 1992 Tax Year

a. Application for Extension of Time To File for 1992

Petitioner prepared and petitioners filed a Form 4868 for

1992 on April 15, 1993, in which they estimated that their total

tax liability for 1992 was $22,000. They reported that they had

made estimated tax payments of $12,000 and had a balance due of

$10,000, which they paid with the Form 4868. 

b. Petitioners’ Federal Income Tax Return for 1992

Petitioner prepared petitioners’ joint Federal income tax

return for 1992. Respondent received it on August 23, 1993. The

envelope in which the return was mailed was postmarked August 16,

1993. They reported that they received income of $141,244 from

petitioner’s law firm and had a tax liability of $35,844.53. 

After subtracting withheld and estimated tax and the payment they
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made when they filed the Form 4868, they reported that they had a

balance due of $13,776.33, which they paid with the return.

4. Audit of Petitioners’ 1991 and 1992 Returns

On September 26, 1994, respondent's auditor wrote a letter

to petitioners enclosing a report recommending additions to tax

under section 6651(a)(1) in the amount of $3,375 for 1991 and

$2,404 for 1992. The letter said the 1991 and 1992 returns had

the same disputed Form 4868 issue that was present on

petitioners’ 1990 return, and that respondent’s auditor wanted to

keep the 3 years together. 

Respondent issued a notice of deficiency for 1991 and 1992

on December 19, 1994. Petitioners filed the petition for tax

years 1991 and 1992 (docket No. 2613-95) on February 16, 1995. 

5. Summary

The following compares the amount of tax liability

petitioners estimated on Forms 4868 for the years in issue with

the amounts they reported on Forms 1040 or have otherwise

conceded for those years:

 Tax Liability

Tax Estimated Tax Reported Conceded by

Year on Form 4868 on Form 1040 Petitioners

1990 $6,000 $18,773.21 $31,856

1991 9,800 24,865.52 25,118

1992 22,000 35,776.33 35,776
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C. Petitioners’ Discovery Request Relating to Imposition of

Addition to Tax Under Section 6651(a)(1) by Respondent

The parties filed a joint motion to calendar and consolidate

these cases. The Court granted the motion on March 6, 1995. 

Paragraph 5 of that motion provides:

5. In the event that the Court grants the

foregoing Motion to Calendar and Consolidate, the

parties hereby stipulate that the petitioners, at the

conclusion of the trial of the consolidated cases, may

file a motion to keep the record open for a reasonable

period of time to pursue discovery of any information

described in Exhibit A, attached, which the Court may

determine is relevant and material to the issues in

these cases. Respondent will not object to the motion

on the grounds that it constitutes untimely discovery

or that petitioners have failed to comply with the

requirements of Branerton Corp. v. Commissioner, 61

T.C. 691 (1974); however, respondent reserves the right

to make any and all other objections.

Exhibit A to that motion is a copy of petitioners’ Amended

Interrogatories to Respondent. In it, petitioners requested data

about the number of taxpayers who filed Forms 4868 for 1990,

1991, and 1992; how many owed more taxes than they paid by the

original due date of the return before extensions; what

percentage of those taxpayers owed more than 10, 20, 30, 40, 50,

60, 100, 200, and 500 percent more than the amount they paid by

the original due date of their return; and for how many of those

taxpayers the Commissioner assessed both the addition to tax

under section 6651(a)(1) and the penalty under section 6662(b)(1)

and (c). 
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OPINION

A. Whether Petitioners' Forms 4868 Are Valid

1. Contentions of the Parties

Petitioners contend that the Forms 4868 that they filed for

1990, 1991, and 1992 are valid because they used the same method

to estimate their tax liability for the years in issue that they

have always used, petitioner was busy with his work, petitioners

did not receive the partnership tax returns or Schedules K-1

for 1990 from the law firm in time to prepare the returns by

April 15, 1991, and, as to their estimate for 1990, they did not

know that they had received the $35,000 pension distribution in

1990.

Respondent contends that the Forms 4868 are invalid because

petitioners did not properly estimate their tax liabilities for

the years to which the Forms 4868 relate. 

2. Background

A calendar year taxpayer generally must file returns by

April 15 after the close of the calendar year. Sec. 6072(a). 

The Commissioner may grant a reasonable extension of time to file

a return. Sec. 6081(a). A 4-month extension is automatic if a

taxpayer timely files a properly prepared Form 4868. Sec.

1.6081-4(a)(1) and (2), Income Tax Regs. 
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A Form 4868 is invalid if the taxpayer fails to properly

estimate his or her tax liability based on information available

to the taxpayer when the extension is requested. Clayton v.

Commissioner, 102 T.C. 632, 650 (1994); Crocker v. Commissioner,

92 T.C. 899, 908, 911 (1989). A taxpayer must estimate his or

her tax liability carefully and must make a reasonable attempt to

find information on which to base the estimate. Crocker v.

Commissioner, supra. The mere fact that a taxpayer

underestimates his or her tax liability does not invalidate a

Form 4868 or void an automatic extension. Id. at 907.

3. Whether Petitioners Properly Estimated Their Tax

Petitioners contend that they estimated their tax with

reasonable care on Forms 4868 for the years in issue. They

contend that the lack of tax documents, such as partnership tax

returns from petitioner’s law firm and a Form 1099 for the

pension distribution, is reasonable cause for their failure to

estimate their tax for 1990 more accurately. They also argue

that their oversight was understandable in the rush of completing

and filing their Form 4868 for 1990. 

We disagree. Petitioner has shown no reason why he, as

senior partner, could not have obtained the partnership returns

sooner. Petitioners could have ascertained the amount of the

draws that petitioner received from his law firm in each year in
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issue and that he received from the pension distribution in 1990. 

Those amounts would have enabled petitioners to estimate their

tax liability for the years in issue far more accurately than

they did. Petitioner’s draws and the income that he reported

from his law firm are as follows:

 Income From

Year Draws Law Firm 

1990 $106,250 $110,615

1991 93,000 105,322

1992 144,120 141,244

Petitioners did not follow the instructions on the Forms

4868 for 1990. Line 1 of Form 4868 calls for the total tax

liability for 1990 that the taxpayer expects to enter on his or

her individual income tax return. For 1990, petitioners did not

make an entry on line 1 of Form 4868. One could infer that

petitioners made a tax liability estimate of $6,000 based on

the Form 4868 by adding the balance due ($1,200) to the total

payments and credits ($4,800). However, $6,000 would not have

been a reasonable estimate; $6,000 is less than one-fifth of the

1990 tax liability ($31,856) to which they later agreed. For

1991, petitioners’ estimate of their tax was about two-fifths of

their liability as reported on their income tax return, and for

1992, their estimate was about two-thirds of their liability as

reported on their income tax return. See table at par. B-5 of

the Findings of Fact, p. 9. Petitioners did not make a bona fide

attempt to base their estimate on information that was reasonably
- 14 -

available to them for the years in issue. See Crocker v.

Commissioner, supra at 910; Boatman v. Commissioner, T.C. Memo.

1995-356 (Form 4868 invalidated when the taxpayers, whose tax

liability was $118,601, estimated that their tax liability was

$60,000). 

Petitioners contend that their situation is like that of the

taxpayers in Hudspeth v. Commissioner, T.C. Memo. 1985-628, revd.

and remanded on another issue 914 F.2d 1207 (9th Cir. 1990). We

disagree. We concluded in Hudspeth that the taxpayers properly

estimated their tax liability based on information available to

them at the time. Petitioners had but did not use information

which was available to properly estimate their tax liability.

We also have considered Jacobs v. Commissioner, T.C. Memo.

1994-252, in deciding this case. In Jacobs, the taxpayer

husband, a lawyer, included his monthly billings in his estimated

income but did not include in his monthly billings, or in his

estimated income, about $29,500 of fees from a personal injury

lawsuit which had been deposited in a client trust account. We

held that the taxpayers properly estimated their tax according to

their regular bookkeeping procedures based on the total of the

monthly billings. We found that their failure to count the

client trust fund in estimating their tax on the Form 4868 did

not invalidate their extension request. Here, there is no

evidence of how petitioners estimated the tax liability shown on
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their Forms 4868 or that they considered petitioner’s partnership

draws or income. For 1992, for which petitioners estimated that

their tax liability was two-thirds of what they later reported on

their Form 1040, there is no evidence that the error related to

an unusual item. Thus, petitioners have not shown that they used

a reasonable method to estimate their tax liabilities when they

filed the Forms 4868 for the years in issue.

Petitioners contend that respondent should have informed

them in a timely manner that their Forms 4868 were invalid. We

disagree. Holding otherwise would unreasonably require the

Commissioner to conduct a detailed examination of every extension

request before approving it. Crocker v. Commissioner, supra at

911. 

Petitioners did not properly estimate their tax liability on

the Forms 4868 they filed for 1990, 1991, and 1992. Thus, we

hold that those forms are invalid. See id. at 910. 

B. Whether Petitioners Are Liable for Additions to Tax for

Failure To Timely File Under Section 6651(a)

Section 6651(a)(1) provides for an addition to tax up to 25

percent for failure to timely file Federal income tax returns

unless the taxpayer shows that such failure was due to reasonable

cause and not willful neglect. United States v. Boyle, 469 U.S.

241, 245 (1985); Baldwin v. Commissioner, 84 T.C. 859, 870

(1985); Davis v. Commissioner, 81 T.C. 806, 820 (1983), affd.

without published opinion 767 F.2d 931 (9th Cir. 1985). 
- 16 -

Petitioners relied on the automatic extensions for the years

in issue as a defense to the addition to tax for failure to

timely file under section 6651(a). Reliance on an automatic

extension is not reasonable cause for a taxpayer's failure to

timely file a return if the taxpayer failed to properly estimate

his or her tax liability in requesting the extension. Crocker v.

Commissioner, 92 T.C. 899 (1989). 

We conclude that petitioners are liable for the additions to

tax under section 6651(a).

C. Whether Petitioners Are Liable for the Accuracy-Related

Penalty Under Section 6662(a)

Respondent determined that petitioners are liable for the

accuracy-related penalty for 1990 under section 6662(a) and (c)

because of negligence (see note 1 to table, p. 2). Taxpayers are

liable for a penalty equal to 20 percent of the portion of the

underpayment to which section 6662 applies. Sec. 6662(a). For

purposes of section 6662(a), negligence includes any failure to

make a reasonable attempt to comply with the provisions of the

Internal Revenue Code. Sec. 6662(c). 

 Negligence frequently involves a failure to report income

or an overstatement of deductions. Marcello v. Commissioner, 380

F.2d 509 (5th Cir. 1967), affg. T.C. Memo. 1964-303; Beus v.

Commissioner, 261 F.2d 176 (9th Cir. 1958), affg. 28 T.C. 1133

(1957); Estate of Mason v. Commissioner, 64 T.C. 651 (1975),

affd. 566 F.2d 2 (6th Cir. 1977). Petitioners did not explain
- 17 -

why they did not report all of petitioner wife’s income, and they

could have easily checked to see when they had received the

$35,000 pension distribution. 

Failure to keep adequate records is evidence of negligence. 

Marcello v. Commissioner, supra; Magnon v. Commissioner, 73 T.C.

980 (1980). A taxpayer is required to maintain records

sufficient to correctly prepare his or her tax return. Sec.

1.6001-1(a), Income Tax Regs. Petitioners had insufficient

records to support their claimed deduction of expenses for meals

and entertainment, $6,818 in business expense deductions for

petitioner wife's activities, and $22,833 in itemized deductions

for unreimbursed employee expenses and personal property taxes. 

Petitioners contend that they were not negligent in

erroneously claiming a dependency exemption for their daughter,

Robin, because they did not know how much she earned. 

Petitioner apparently assumed without checking that they could

claim an exemption for her. There is no evidence that they tried

to find out how much she earned.

Petitioners’ understatement of income and overstatement of

deductions and the inadequacy of their records are sufficient to

show that they were negligent. We conclude that petitioners are

liable for the accuracy-related penalty for 1990 under section

6662(a).
- 18 -

2 See par. D-3, p. 21.

3 The Fifth Amendment to the Constitution provides as

follows:

No person shall be held to answer for a capital,

or otherwise infamous crime, unless on a presentment or

indictment of a Grand Jury, except in cases arising in

the land or naval forces, or in the Militia, when in

actual service in time of War or public danger; nor

shall any person be subject for the same offense to be

twice put in jeopardy of life or limb; nor shall be

compelled in any criminal case to be a witness against

himself, nor be deprived of life, liberty, or property,

without due process of law; nor shall private property

be taken for public use, without just compensation.

D. Whether the Double Jeopardy Clause Bars Imposition of the

Additions to Tax for Failure To Timely File and Pay Under

Section 6651(a)(1) and (2) and the Penalty for Negligence

Under Section 6662(a) and (c)

Petitioners contend that imposition of both the addition to

tax for failure to timely file and pay under section 6651(a)(1)

and (2)2 and the accuracy-related penalty under section 6662(a)

and (c) for negligence is unlawful and violates the Double

Jeopardy Clause because those sections penalize the same conduct. 

We disagree.

1. Sections 6651(a)(1) and (2) and 6662(a) Are Not

Punishment for Purposes of the Double Jeopardy Clause

The Double Jeopardy Clause forbids "any person * * * subject

for the same offense to be twice put in jeopardy of life or

limb."3 Petitioners contend that sections 6651(a)(1) and (2)

and 6662(a) impose punishment as defined in Department of Revenue

v. Kurth Ranch, 511 U.S. __, 114 S. Ct. 1937 (1994), and United
- 19 -

States v. Halper, 490 U.S. 435 (1989). A civil sanction is

punishment for double jeopardy purposes if it is not solely

remedial but also serves punitive goals of deterrence or

retribution. Department of Revenue v. Kurth Ranch, 511 U.S. at

__, 114 S. Ct. at 1944; United States v. Halper, supra at 448-

449; see Barnette v. Commissioner, 95 T.C. 341, 346-347 (1990)

(discussing Halper).

Additions to tax such as section 6651(a) are not punishment

for purposes of the Double Jeopardy Clause. The U.S. Supreme

Court has said: 

The remedial character of sanctions imposing additions

to a tax has been made clear by this Court in passing

upon similar legislation. They are provided primarily

as a safeguard for the protection of the revenue and to

reimburse the Government for the heavy expense of

investigation and the loss resulting from the

taxpayer’s fraud. [Helvering v. Mitchell, 303 U.S.

391, 401 (1938).] 

See Miller v. Commissioner, T.C. Memo. 1994-249 (increased

interest under section 6621(c) not punishment); Dillon v.

Commissioner, T.C. Memo. 1981-583. The accuracy-related penalty

under section 6662(a) and (c) for negligence is also remedial.

See Helvering v. Mitchell, supra at 399-406 (the 50-percent

addition to tax for civil fraud is remedial and not punitive for

double jeopardy purposes); United States v. Alt, ___ F.3d ___

(6th Cir., May 15, 1996); Ianniello v. Commissioner, 98 T.C. 165,

176-177 (1992). The accuracy-related penalty under section

6662(a) is 20 percent. It is less severe than the addition to
- 20 -

tax for fraud. We conclude that the accuracy-related penalty

under section 6662(a) and (c) is not punishment for purposes of

the Double Jeopardy Clause.

Sections 6651(a) and 6662(a) are quite different than the

Montana drug tax, the imposition of which the U.S. Supreme Court

held violated the Double Jeopardy Clause. Department of Revenue

v. Kurth Ranch, 511 U.S. at __, 114 S. Ct. at 1944. Montana

imposed almost $900,000 in taxes and penalties against six

individuals who pleaded guilty to possession or storage of

dangerous drugs. Id. at __, 114 S. Ct. at 1942, 1946-1947. 

Montana assessed the tax on illegally possessed marijuana and

hash oil which had been confiscated. The tax equaled about 800

percent of the market value of the confiscated drugs. The tax

applied only in cases in which the State had imposed a criminal

penalty for possession of illegal drugs. Id. at __, 114 S. Ct.

at 1947. The Supreme Court held that the Montana drug tax is the

equivalent of criminal punishment for purposes of the Double

Jeopardy Clause. Id. at __, 114 S. Ct. at 1948. Sections

6651(a) and 6662(a) and (c) are very different from the Montana

drug tax; those sections are remedial and intended to compensate

the Government for a taxpayer’s noncompliance. Thus, Department

of Revenue v. Kurth Ranch, supra, does not control here. See

United States v. Alt, supra. 
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2. Sections 6651(a)(1) and 6662(a) Do Not Punish the Same

Conduct for Purposes of the Double Jeopardy Clause

The Double Jeopardy Clause applies only if a person is put

in jeopardy twice for the same conduct. Conduct is different for

double jeopardy purposes if the two proceedings require proof of

different facts. “[T]he test to be applied to determine whether

there are two offenses or only one, is whether each provision

requires proof of a fact which the other does not.” Blockburger

v. United States, 284 U.S. 299, 304 (1932); see also Brown v.

Ohio, 432 U.S. 161, 166 (1977). If each statutory provision

requires proof of a fact that the other does not, the Blockburger

test is met and the provisions are not the same for double

jeopardy purposes. Iannelli v. United States, 420 U.S. 770, 785

n.17 (1975).

Section 6651(a)(1) and (2) applies to failure to timely file

a return and pay tax. Section 6662(a) and (c) requires proof of

negligence. Thus, conduct under section 6651(a)(1) and (2) and

section 6662(a) and (c) is not the same for double jeopardy

purposes. See sec. 1.6662-2(a), Income Tax Regs. Petitioners

are liable for the addition to tax for failure to timely file

under section 6651(a)(1) for 1990 because they did not properly

estimate their tax liability on their Forms 4868, thus

invalidating respondent’s consent based on those forms to extend

filing dates for those returns by 4 months. See pars. A and B,

pp. 10, 14. They are liable for the accuracy-related penalty
- 22 -

under section 6652 (a) and (c) for 1990 because they

underreported their income, overstated their deductions, and

failed to keep adequate records. See par. C, p. 15. Also, the

additions for tax for negligence and late filing are remedial. 

We conclude that the Double Jeopardy Clause does not shield

petitioners from liability for additions to tax under sections

6651(a) and 6662(a). 

Petitioners also contend that respondent unlawfully (other

than in violation of the Double Jeopardy Clause) penalized them

twice for the same conduct. Petitioners have not given any

authority to support this theory, and we are aware of none.

3. Imposition of the Addition to Tax Under Section

6651(a)(2)

Respondent determined that petitioners are liable for the

additions to tax under section 6651(a)(1) for all of the years in

issue but did not determine that petitioners are liable under

section 6651(a)(2). Before respondent determined that

petitioners were liable for the addition to tax under section

6651(a)(1), respondent issued a Request for Payment for 1990 to

petitioners to pay the addition to tax under section 6651(a)(2). 

The Commissioner may assess tax without issuing a notice of

deficiency if a taxpayer does not pay the amount shown on his or

her return. Sec. 6213(b)(1). Petitioners paid the addition to

tax for late payment under section 6651(a)(2) before respondent

determined that they are liable for the addition to tax under
- 23 -

section 6651(a)(1). Petitioners contend that the imposition of

additions to tax under section 6651(a)(1) and (2) violates the

Double Jeopardy Clause. We disagree.

Section 6651(a)(1) provides for an addition to tax for

failure to timely file Federal income tax returns of 5 percent

per month up to 25 percent of the difference between the correct

amount of tax and the amount paid before the due date plus

credits. Section 6651(a)(2) provides for an addition to tax of

0.5 percent per month up to 25 percent for failure to pay the

amount shown or required to be shown on a return. A taxpayer may

fail to file and pay a tax, and thus be subject to both section

6651(a)(1) and (2). See sec. 6651(c)(1). If that occurs, the

amount of the addition to tax under section 6651(a)(1) is reduced

by the amount of the addition to tax under section 6651(a)(2) for

any month to which an addition to tax applies under both

paragraphs (1) and (2). The combined amounts under paragraphs

(1) and (2) cannot exceed 5 percent per month. Sec. 6651(c)(1). 

Also, section 6651(a)(1) requires proof of different facts from

section 6651(a)(2). See Iannelli v. United States, supra;

Blockburger v. United States, supra. Also, the additions to tax

under section 6651(a)(1) and (2) are remedial. Thus, we conclude

that imposition of additions to tax under section 6651(a)(1) and

section 6651(a)(2) does not violate the Double Jeopardy Clause.
- 24 -

E. Whether Petitioners Are Not Liable for Additions to Tax

Under Section 6651(a) Because Respondent Selectively Applied

It to Them

1. Background

Petitioners contend that they are not liable for additions

to tax under section 6651(a) because, in petitioners’ view,

respondent selectively applied it to them. We disagree.

The standard for evaluating a claim of selective or

discriminatory prosecution in a criminal case is as follows:

the person asserting such a claim bears the burden of

establishing, prima facie, both: 

(1) that, while others similarly situated have

not generally been proceeded against because of

conduct of the type forming the basis of the

charge against him, he has been singled out for

[investigation], and (2) that the government's

discriminatory selection of him for

[investigation] has been invidious or in bad

faith, i.e., based upon such impermissible

considerations as race, religion, or the desire

to prevent his exercise of constitutional rights.

[St. German of Alaska E. Orthodox Catholic Church

v. United States, 840 F.2d 1087, 1095 (2d Cir.

1988).] 

Petitioners' claim lacks merit if it does not meet the standard

applied in criminal cases. Karme v. Commissioner, 673 F.2d 1062,

1064 (9th Cir. 1982), affg. 73 T.C. 1163 (1980).

2. Petitioners’ Discovery Request

Petitioners seek to discover statistical information about

respondent’s imposition of additions to tax under section 6651

against taxpayers who filed Forms 4868 for the years in issue. 

Petitioners argue that they will not know whether it was rational
- 25 -

for respondent to impose the penalties unless respondent responds

to their discovery requests. Petitioners speculate that the

facts they seek may show that petitioners were treated unlawfully

or arbitrarily, or lead to evidence showing that there was

unlawful discrimination. 

 Respondent contends that the data would be irrelevant and

production would be burdensome. 

We need not allow discovery relating to a claim that

respondent has selectively enforced the law or unlawfully

discriminated unless the proponent makes a prima facie showing

that both elements of the standard stated above are met. St.

German of Alaska E. Orthodox Catholic Church v. United States,

supra; United States v. Bohrer, 807 F.2d 159, 161 (10th Cir.

1986); United States v. Bustamante, 805 F.2d 201, 202 (6th Cir.

1986); United States v. Moon, 718 F.2d 1210, 1229 (2d Cir. 1983);

United States v. Ness, 652 F.2d 890, 892 (9th Cir. 1981); United

States v. Catlett, 584 F.2d 864, 866 (8th Cir. 1978); PennField Indus., Inc. v. Commissioner, 74 T.C. 720, 724 (1980)

(Internal Revenue Service (IRS) was not required to produce audit

data to taxpayer which failed to make a prima facie case that it

was improperly selected for audit); Davis v. Commissioner, 65

T.C. 1014, 1022-1024 (1976) (IRS was not required to produce

letter rulings relating to other taxpayers who had claimed

deductions similar to those claimed by taxpayer). Petitioners
- 26 -

have not made a prima facie showing that either of the elements

are met; i.e., (1) That respondent applied section 6651(a)(1) to

petitioners while not proceeding against others who were

similarly situated; or (2) that respondent selectively

discriminated against them based on impermissible considerations

such as race, religion, or the desire to prevent the exercise of

constitutional rights.

3. Petitioners’ Allegation That Respondent’s

Determinations for 1991 and 1992 Are Punishment for

Petitioners’ Challenge to Respondent’s Determination

for 1990

Petitioners contend that respondent’s determinations for

1991 and 1992 unlawfully punishes them for challenging

respondent’s determination for 1990. We disagree. 

The Commissioner has broad authority to investigate and

examine persons who may be liable for taxes. Greenberg's

Express, Inc. v. Commissioner, 62 T.C. 324, 328-329 (1974). The

IRS “can investigate merely on suspicion that the law is being

violated, or even just because it wants assurance that it is

not.” United States v. Powell, 379 U.S. 48, 57 (1964); United

States v. Morton Salt Co., 338 U.S. 632, 642-643 (1950). 

Petitioners point out that respondent issued the notice of

deficiency for 1991 and 1992 after petitioners filed the petition

contesting respondent’s 1990 determination. There is nothing

improper about this sequence of events or the fact that

respondent audited petitioners for 3 consecutive years. See
- 27 -

Foxman v. Renison, 625 F.2d 429, 432 (2d Cir. 1980) (IRS audit

of taxpayer’s returns for 4 consecutive years was not an unlawful

selective audit). Petitioners filed their 1991 and 1992 returns

on August 20, 1992, and August 23, 1993, respectively. It would

have been virtually impossible for respondent to make a

determination relating to petitioners’ 1991 and 1992 tax years

as early as the determination was made for 1990. We infer no

improper motive or bias in respondent’s determinations for 1991

and 1992. 

Petitioners point out that on September 26, 1994,

respondent’s auditor wrote petitioners a letter attaching her

report of proposed income tax examination changes for

petitioners’ 1991 and 1992 tax years (additions to tax for

failure to file under section 6651(a)(1)). She said in the

letter that she forwarded those reports to keep them with the

1990 file because they all presented the same Form 4868 issue. 

Petitioners contend that the letter from respondent's auditor

shows that respondent determined that the additions to tax apply

for 1991 and 1992 because petitioners challenged respondent’s

determination for 1990. We disagree. The September 26, 1994,

letter shows that respondent's auditor wanted to keep

petitioners' 1990, 1991, and 1992 audits together because they

presented the same disputed Form 4868 issue. It does not show

that respondent had an improper motive. 
- 28 -

4. Conclusion

For the foregoing reasons, we deny petitioners' motion to

compel further discovery relating to whether respondent has

illegally or selectively enforced the law in this case. 

To reflect concessions by petitioners and the foregoing,

Decisions will be

entered for respondent.