TAX COURT OPINION

Case: Godwin I. Umeakuana
Docket Number: 14092-07S
Judge: Colvin
Opinion Type: bench
Filed: 06/05/2008
Pages: 21

ADM.j REC ORDE3D SERVICE CAL . STAT . S .T . JUDGE FILE S UNITED STATES TAX COURT WASHINGTON , DC 2021 7 GODWIN UMEAKUANA, Petitione r v . ) Docket No . 14092-07S . COMMISSIONER OF INTERNAL REVENUE , Respondent O R D E R Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it i s ORDERED that the Clerk of the Court shall transmit herewith to petitioner and to respondent a copy of the pages of the transcript of the trial of the above case before Special Trial Judge Robert N . Armen, Jr . at. Dallas, Texas, on May 7, 2008, containing his oral findings of fact and opinion rendered at the conclusion of the trial . In accordance with the oral findings of fact and opinion, a Decision will be entered for respondent . (Signed ) Robert N . Armen, Jr. Special Trial Judg e Dated : Washington, D .C . June 5, 2008 I SERVED JUN - 6 2008 2 1 Bench Opinion by Special Trial Judge Robert Armen, Jr . 2 May 7, 200 8 3 Umeakuana v . Commissioner Docket No . 14092-07S 4 I . 5 THE COURT : THE COURT HAS DECIDED TO RENDER 6 ORAL FINDINGS OF FACT AND OPINION IN THIS CASE, AND 7 THE FOLLOWING REPRESENTS THE COURT'S ORAL FINDINGS OF 8 FACT AND OPINION . THE ORAL FINDINGS OF FACT AND 9 OPINION SHALL NCT BE RELIED UPON AS PRECEDENT IN ANY 10 OTHER CASE . 11 II . 12 This proceeding was heard as a Small Tax 13 Case, pursuant-to the provisions of Section 7463 of 14 the Internal Revenue Code of 1986, as amended, and 15 Rules 170 through 175 of the Tax Court Rules o f 16 Practice and Procedure . 17 III . 18 This bench opinion is made pursuant to the 19 authority granted by Section 7459(b) of the Internal 20 Revenue Code of 1986, as amended, and Rule 152 of the 21 Tax Court Rules of Practice and Procedure . 22 Hereinafter in this bench opinion and unless 23 otherwise indicated, all section numbers refer to the 24 Internal Revenue Code, as amended and in effect for 25 2002, 2003 and 2004, the taxable years in issue, and Heritage Reporting Corporatio n (202) 628-4888 3 1 all Rule numbers refer to the Tax Court Rules o f 2 Practice and Procedure . 3 IV . 4 Godwin Umeakuana appeared on his own behalf . 5 Michelle M . Kwon appeared on behalf of the Respondent . 6 V . 7 Respondent determined deficiencies i n 8 Petitioner ' s Federal income taxes for 2002, 2003 and 9 2004 in the amounts of $2,047, $1,560 and $2,58 0 10 respectively . ( Parenthetically , we note that the 11 deficiency for 2002 does not reflect an additional 12 prepayment credit in the amount of $123 that will be 13 applied against the deficiency for that year .) For 14 2002, Respondent also determined an addition to tax 15 under Section 6651 ( a)(1) in the amount of $111 .60 for 16 failure to timely file . 17 VI . 18 For 2C02 , Petitioner concedes that he faile d 19 to report wages of $2 ,20 paid to him by Builder s -S 20 Electric Corporation . After that concession, the 21 issues for decision by the Court are as follows : 22 (1) Whether, for 2002 and 2004, Petitioner 23 is entitled to itemized deductions, principall y 24 employee expenses, as claimed by him on a Schedule A 25 for each of those years, and ; Heritage Reporting Corporation (202) 628-4888 4 1 (2) whether, for 2003, Petitioner i s 2 entitled to car and truck expenses as claimed by him 3 on a Schedule C for that year . 4 VII . 5 Some of the facts have been stipulated, and 6 they are so found . 7 Petitioner resided in the State of Texas at 8 the time that the Petitioner was filed with the Court . 9 Petitioner's Employmen t 10 Petitioner is by trade an electrician . 11 Petitioner makes his living by working as an employee 12 for various electrical companies . In one year , 13 Petitioner also worked for a company and received a 14 modest amount of nonemployee compensation . Thus : 15 During 2002, Petitioner was employed by 16 Builders Electric Service and by Builders Electric 17 Corporation, which were affiliated companies . Fo r 18 that year, Petitioner received total wages of $35,145 . 19 Of that amount, Builders Electric Service pai d 20 Petitioner $32,895 and Builders Electric Corporation 21 paid Petitioner $2,250 . 22 Neither Builders Electric Service no r 23 Builders Electric Corporation provided Petitioner with 24 a truck or other vehicle in 2002 . Rather, Petitioner 25 provided his own transport during that year i n Heritage Reporting Corporation (202) 628-4888 5 1 vehicles that he personally owned . 2 During 2003, Petitioner was employed by 3 Robertson Electric , Inc . and by Mills Electric LP . 4 For that year, Petitioner received total wages of 5 $28,828 . Of that amount , Robertson Electric pai d 6 Petitioner $ 12,724 and Mills Electric paid Petitioner 7 $16,104 . 8 Neither Robertson Electric nor Mill s 9 Electric provided Petitioner with a truck or othe r 10 vehicle in 2003 . Rather, Petitioner provided his own 11 transport during that year in vehicles that h e 12 personally owned . 13 Also during 2003, Petitioner received 14 nonemployee compensation of $3,620 from Unite d 15 Commercial Services , Inc ., which amount was reported 16 by the payor on a Form 1099-MISC . 17 During 2004, Petitioner was employed b y 18 Mills Electric and by Standfield Enterprise, dba S&J 19 Electric . ( We shall henceforth refer to the latter 20 company as S&J Electric .) For that year , Petitioner 21 received total wages of $43,826 . Of that amount , 22 Mills Electric paid Petitioner $ 17,285 and S&J paid 23 Petitioner $ 26,541 . 24 Neither Mills Electric nor S&J Electri c 25 provided Petitioner with a truck or other vehicle in Heritage Reporting Corporatio n (202) 628-4888 6 1 2004 . Rather, Petitioner provided his own transport 2 during that year in vehicles that he personally owned . 3 Petitioner's Return for 200 2 4 Petitioner filed a Federal income tax 5 return, Form 1040, for 2002 . Although Petitioner 6 obtained a filing extension to August 15, 2003 , 7 Respondent's Austin, Texas, Service Center did no t 8 receive Petitioner's return until September 19, 2003 . 9 On his 2002 return, Petitioner reported his 10 wages of $32,895 that he received from Builder s 11 Electric Service, but he failed to report his wages of 12 $2,250 that he received from Builders Electri c 13 Corporation . (Parenthetically, we note tha t 14 Petitioner did not claim as a credit on his return the 15 $123 of income tax withheld by Builders Electri c 16 Corporation from his wages .) Petitioner also reported 17 unemployment compensation of $1,640 and thus reported 18 total income of $34,535, i . e ., wages of $32,895 and 19 unemployment compensation of $1,640 . 20 Petitioner attached to his 2002 return a 21 Schedule A and itemized his deductions . Thes e 22 consisted of unreimbursed employee expenses o f 23 $15,676, tax preparation fees of $175 and personal 24 property taxes of $55 . 25 In support of his deduction for unreimbursed Heritage Reporting Corporatio n (202) 628-4888 7 1 employee expenses, Petitioner attached to his return a 2 Form 2106, Employee Business Expenses . This form 3 claimed only vehicle expense of $13,176 in respect of 4 a vehicle placed in service on January 6, 2002 . (The 5 difference between the $13,176 figure and the $15,676 6 deduction for unreimbursed employee expenses claimed 7 on Schedule A is unexplained in the record . ) 8 Petitioner did not claim the standar d 9 mileage rate on his Form 2106 . Rather, Petitioner 10 claimed actual expenses, consisting of $1,934 fo r 11 gasoline, oil, repairs, insurance and other operating 12 expenses, and $16,756 for the value of employer- 13 provided vehicle(s) . Petitioner added these two 14 amounts together and then applied a business-use 15 percentage of 70 .50 to arrive at the deduction claimed 16 of $13,176 . 17 Petitioner was not furnished with a n 18 employer-provided vehicle in 2002 by either Builders 19 Electric Service or Builders Electric Corporation . 20 The Form W-2 issued to Petitioner by Builders Electric 21 Service for 2002 and the Form W-2 issued to Petitioner 22 by Builders Electric Corporation for 2002 reporte d 23 only the wages paid to Petitioner during that year . 24 Petitioner's Return for 200 3 25 Petitioner filed a Federal income tax Heritage Reporting Corporation (202) 628-4888 8 1 return, Form 1040, for 2003 . On his return, 2 Petitioner reported total income of $16,573, 3 consisting of (1) his wages of $28,828, (2 ) 4 unemployment compensation of $656, and (3) a business 5 loss of $12,911 . 6 Petitioner did not itemize his deductions in 7 2003 ; rather, he claimed the standard deduction o f 8 $4,750 . 9 Petitioner attached to his 2003 return a 10 Schedule C, Profit or Loss from Business . 11 Petitioner's name for his proprietorship was "Electric 12 Experts of America," which was first listed in th e 13 Assume Name records of the office of the County Clerk 14 of Dallas County, Texas, in 2002 . 15 On his Schedule C, Petitioner reported gross 16 income of $3,620, which amount represented nonemployee 17 compensation paid to him by United Commercia l 18 Services, Inc ., and reported by the payor on a Form 19 1099-MISC . Petitioner then claimed total expenses of 20 $16,531, thereby resulting in a net loss of $12,911 . 21 Included among total expenses of $16,531 was 22 a deduction for car and truck expenses of $10,386 . In 23 Part IV of his Schedule C, Petitioner claimed that he 24 placed his vehicle in service on January 20, 2003 and 25 that he drove his vehicle 28,850 miles for busines s Heritage Reporting Corporation (202) 628-4888 9 1 and 6,985 miles for commuting . 2 Insofar as the taxable years in issue are 3 concerned, Petitioner attached a Schedule C to his 4 income tax return for only 2003 . That year was the 5 only year in which Petitioner received business income 6 that was reported by the payor on a Form 1099-MISC or 7 similar reporting document . 8 Petitioner's Return for 200 4 9 Petitioner filed a Federal income tax 10 return, Form 1040, for 2004 . On his return , 11 Petitioner reported total income of $43,826 consisting 12 of his wages . 13 Petitioner attached to his 2004 return a 14 Schedule A and itemized his deductions . Thes e 15 consisted of unreimbursed employee expenses of $17,732 16 and taxes paid of $645 . 17 In support of his deduction for unreimbursed 18 employee expenses, Petitioner attached to his return a 19 Form 2106, Employee Business Expenses . This form 20 claimed a vehicle expense of $17,732 in respect of a 21 vehicle placed in service on January 15, 2004 . 22 Petitioner did not claim the standard mileage rate on 23 his Form 2106 . Rather, Petitioner claimed actua l 24 expenses, consisting of $2,575 for gasoline, oil , 25 repairs, insurance and other operating expenses, and Heritage Reporting Corporatio n (202) 628-4888 10 1 $16,980 for the value of employer-provided vehicle(s) . 2 Petitioner added these two amounts together and then 3 applied a business-use percentage of 90 .68 to arrive 4 at the deduction claimed of $17,732 . 5 Petitioner was not furnished with an 6 employer-provided vehicle in 2004 by either Mills 7 Electric or S&J Electric . The Form W-2 issued t o 8 Petitioner by Mills Electric for 2004 and the Form W-2 9 issued to Petitioner by S&J Electric for 2004 reported 10 only the wages paid to Petitioner during that year . 11 Respondent's Notice of Deficienc y 12 By notice dated March 22, 2007, Respondent 13 determined deficiencies in Petitioner's income taxes 14 for 2002, 2003 and 2004, together with an addition to 15 tax under Section 6651(a)(1) for failure to timel y 16 file for 2002 . 17 The deficiency for 2002 is principall y 18 attributable to and the deficiency for 2004 is solely 19 attributable to the disallowance of Petitioner' s 20 itemized deductions for lack of substantiation . 21 Although Respondent allowed the deductions for taxes 22 paid for each year, those deductions were modest in 23 amount and substantially less than the standar d 24 deduction of $4,700 for 2002 and $4,850 for 2004, 25 which Respondent allowed as more advantageous to Heritage Reporting Corporation (202) 628-4888 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 1 1 Petitioner . For 2002, the deficiency is als o attributable to Petitioner's failure to include i n income his wages of $2,250 received from Builder s Electric Corporation . The deficiency for 2003 is attributable t o the disallowance, for lack of substantiation, of the Schedule C deduction for car and truck expenses o f $10,386 . The addition to tax under Section 6651(a)( 1 is attributable to the fact that Respondent receive d Petitioner's 2002 return on September 19, 2003, mor e than a month after the due date, as extended, o f Friday, August 15, 2003 . VIII . We turn now to several fundamenta l principles of tax litigation that inform ou r disposition of the disputed issues . First, as a general rule, the Commissioner' s determinations are presumed correct, and the taxpaye r bears the burden of proving that those determination s are erroneous . Rule 142(a) . This principle wa s firmly established by the United States Supreme Cour t as early as 1933 and has been reaffirmed by th e Supreme Court as recently as 1992 . See INDOPCO, Inc . Heritage Reporting Corporation (202) 628-4888 12 1 2 v . Commissioner , 503 U . S . 79, 84 (1992) ; Welch v . Helverinq , 290 U . S . 111, 115 (1933) . 3 Although Section 7491(a) may serve to shift 4 the burden of proof to the Commissioner, that section 5 has no application to the present case in view of the 6 fact that : (1) Petitioner has not asserted it s 7 applicability ; (2) Petitioner has failed t o 8 demonstrate that he maintained the requisite books and 9 records, see Sec . 7491(a)(2), and ; (3) Petitione r 10 failed to introduce credible evidence sufficient to 11 establish a prima facie case, see Sec . 7491(a)(1) . 12 Second, deduction are a matter o f 13 legislative grace, and the taxpayer bears the burden 14 of proving that he or she is entitled to any deduction 15 claimed . Rule 142(a) ; Deputy v . duPont , 308 U . S . 16 488, 493 (1940) ; New Colonial Ice Co . v . Helvering, 17 292 U . S . 435, 440 (1934) ; Welch v . Helvering, supra . 18 This includes the burden of substantiation . Hradesky 19 v . Commissione r, 65 T .C . 87, 90 (1975), affd . pe r 20 curiam 540 F .2d 821 (5th Cir . 1976) . 21 Third, the Court is not bound to accept as 22 gospel the unverified and undocumented testimony of a 23 taxpayer . Hradesky v . Commissioner , supra ; Tokarski 24 25 v . Commissioner , 87 T .C . 74, 77 (1986) . Indeed, in Krupp v . Commissioner , T .C . Memo . 2000-148, we state d Heritage Reporting Corporation (202) 628-4888 13 1 that, "As a trier of fact, it is our duty to listen t o 2 the testimony, observe the demeanor of the witnesses, 3 weigh in the evidence and determine what we believe ." 4 Similarly, in Diaz v . Commissioner 58 T .C . 560, 56 4 5 (1972), we observed that the process of distilling 6 truth from the testimony of witnesses, whose demeanor 7 we observe and whose credibility we evaluate, is the 8 daily grist of judicial life . 9 Based on these principles, we will be 10 constrained to sustain Respondent's disallowance of 11 deductions to the extent that Petitioner does not 12 sustain his burden of proof . Petitioner does not 13 sustain his burden of proof through the simpl e 14 expedient of proclaiming that he has proof, that h e 15 has satisfied all requirements imposed by law and that 16 he is entitled to the deductions claimed . Se e 17 Seaboard Commercial Corp . v . Commissioner , 28 T .C . 18 1034, 1051 (1957) (a taxpayer's income tax return is a 19 self-serving declaration that may not be accepted as 20 proof for the deduction or exclusion claimed by th e 21 taxpayer) ; Halle v . Commissioner , 7 T . C . 245 (1946) 22 (a taxpayer's return is not self-proving as to the 23 truth of its contents), affd . 175 F .2d 500 (2d Cir . 24 1949) . After all, a tax return is merely a statement 25 of the taxpayer's claim ; the return is not presumed t o Heritage Reporting Corporation (202) 628-4888 1 be correct . Wilkinson v . Commissioner , 71 T .C . 633 , 2 639 (1979) ; Roberts v . Commissioner , 62 . T .C . 834, 837 14 3 (1974) . 4 IX . 5 We turn now to the substantive law . 6 Section 6001 and the regulations promulgated 7 thereunder require taxpayers to maintain record s 8 sufficient to permit verification of income an d 9 expenses . See Sec . 1 .6001-1(a) and (e), Income Tax 10 Regs . 11 As a general rule, if, in the absence o f 12 such records, a taxpayer provides sufficient evidence 13 that the taxpayer has incurred a deductible expense, 14 but the taxpayer is unable to adequately substantiate 15 the amount of the deduction to which he or she i s 16 otherwise entitled, the Court may estimate the amount 17 of such expense and allow the deduction to tha t 18 extent . Cohan v . Commissioner , 39 F .2D 540, 543-544 19 (2d Cir . 1930) . However, in order for the Court to 20 estimate the amount of an expense, we must have some 21 basis upon which an estimate may be made . Vanicek v . 22 Commissioner , 85 T .C . 731, 743 (1985) . Without such a 23 basis, any allowance would amount to unguide d 24 largesse . Williams v . United States , 245 F .2d 559, 25 560 (5th Cir . 1957) . Heritage Reporting Corporation (202) 628-4888 1 5 1 In the case of certain expenses, Section 2 274(d) overrides the co-called Cohan doctrine . 3 Sanford v . Commissioner , 50 T .C . 823, 827 (1968), 4 affd . per curiam 412 F .2d 201 (2d Cir . 1969) ; Sec . 5 1 .274-5T(a), Temporary Income Tax Regs . Specifically, 6 Section 274(d) provides that no deduction is allowable 7 with respect to any listed property, as defined i n 8 Section 280F(d)(4), unless the deduction is 9 substantiated in accordance with the stric t 10 substantiation requirements of Section 274(d) and the 11 regulations promulgated thereunder . Included within 12 the definition of listed property in Section 13 280F(d)(4) is any 4-wheeled vehicle that i s 14 manufactured primarily for use on public streets , 15 roads and highways and which is rated at 6,000 pounds 16 gross vehicle weight . Sec . 280F(d)(4)(A) and (5) ; 17 Sec . 1 .280F-6(b) and (c), Income Tax Regs . ; see Sec . 18 1 .274-5T(k), Temp . Income Tax Regs . 19 Thus, under Section 274(d), no deduction is 20 allowable for expenses incurred in respect of listed 21 property on the basis of any approximation or th e 22 unsupported testimony of the taxpayer . E .g ., Golden 23 v . Commissioner , T .C . Memo . 1993-602 . In other words, 24 in order to obtain a deduction in respect of listed 25 property, a taxpayer must substantiate the amount o f Heritage Reporting Corporation (202) 628-4888 1 the expense, the time and place of the use and th e 2 business purpose of the use . Sec . 274(d) ; Sec . 1 .274- 3 5T(c), Temporary Income Tax Regs . Otherwise, th e 1 6 4 deduction is proscribed . 5 X . 6 We turn now to the record before us . 7 Taxable Years 2002 and 200 4 8 Petitioner did not claim the standard 9 mileage rate for either 2002 or 2004 . Rather , 10 Petitioner claimed actual expenses, consisting of (1) 11 operating expenses and (2) the value of employer- 12 provided vehicle ;s) . 13 Petitioner was not furnished with an 14 employer-provided vehicle in either 2002 or 2004 . 15 Rather, during both of those years, Petitioner 16 provided his own transport in vehicles that h e 17 personally owned . In addition, each of the Forms W-2 18 that were issued to Petitioner by his employers i n 19 2002 and 2004 reported only the wages paid to 20 Petitioner during those years . 21 In view of the foregoing, there was no basis 22 for Petitioner to claim deductions in 2002 and 200 4 23 based on the value of employer-provided vehicle(s) . 24 That approach would apply only if 100 percent of the 25 annual lease value of an employer-provided vehicl e Heritage Reporting Corporation (202) 628-4888 1 7 1 were included in the taxpayer's Form W-2 . 2 Arguably, Petitioner might have bee n 3 entitled in 2002 and 2004 to a depreciation deduction 4 in lieu of the value of an employer-provided vehicle . 5 Unfortunately for Petitioner, the record does no t 6 include a scintilla of evidence regarding the amount 7 of any such deduction, assuming its allowability . 8 Indeed, the record does not support the specifi c 9 deductions claimed of $1,934 in 2002 and $2,575 in 10 2004 for gasoline, oil, repairs, insurance and other 11 operating expenses, again, assuming thei r 12 allowability . 13 In addition, the record indicates (at 14 Exhibit 8-J) that expenses incurred by Petitione r 15 while employed by S&J Electric were reimbursable upon 16 submission of documentation by Petitioner to th e 17 company . In that regard, it has long been held that a 18 taxpayer is not entitled to a deduction for expenses 19 to the extent that the taxpayer is entitled to b e 20 reimbursed for such expenses but does not clai m 21 reimbursement . Podems v . Commissioner , 24 T .C . 21, 22 22-23 (1955) ; Horwath v . Commissioner , T .C . Memo . 23 2004-213, and cases cited therein . In addition, the 24 employee has the burden of establishing that th e 25 employer would not reimburse the expense had the Heritage Reporting Corporatio n (202) 628-4888 1 8 1 employee requested reimbursement . Podems v . 2 Commissioner , supra at 23 . 3 At trial, Petitioner demonstrated that h e 4 did not in fact receive any reimbursement in 2004 from 5 S&J Electric for either mileage or personal tools . 6 However, Petitioner's evidence does not demonstrate 7 that expenses incurred on behalf of his employer were 8 reimbursable upon presentation to the company o f 9 adequate documentation by Petitioner . 10 In short, Petitioner has failed to prove 11 that whatever itemized deductions he may be entitled 12 to for employee expenses, together with his itemized 13 deductions for taxes paid, exceed the standar d 14 deduction that Respondent allowed in 2002 and 2004 . 15 Accordingly, we sustain Respondent's disallowance of 16 the deductions claimed by Petitioner for employe e 17 expenses in 2002 and 2004 . 18 Taxable Year 200 3 19 In 2003, Petitioner did not itemize his 20 deductions but claimed the standard deduction . 21 However, Petitioner did file a Schedule C and claimed 22 thereon a deduction for car and truck expenses o f 23 $10,386 . Remarkably, the record does not reveal how 24 Petitioner determined this deduction, e .g ., based on 25 actual expenses, as in 2002 and 2004, or based on the Heritage Reporting Corporatio n (202) 628-4888 1 9 1 standard mileage rate . 2 If Petitioner based the deduction on actual 3 expenses, the record is devoid of evidence supporting 4 the $10,386 amount . If Petitioner based the deduction 5 on the standard mileage rate, we assume that he relies 6 on the "log" that he introduced at trial together with 7 his testimony . 8 Petitioner's evidence does not satisfy the 9 strict substantiation requirements of Section 274(d), 10 as we are unconvinced that Petitioner's log represents 11 an accurate, complete and contemporaneous recor d 12 consistent with the statute and the regulation s 13 promulgated thereunder . Furthermore, Petitioner's 14 evidence does not even demonstrate that the mileage 15 claimed was anything other than commuting . (The cost 16 of commuting is, of course, a nondeductible personal 17 expense . Secs . 1 .162-2(e), 1 .262-1(b)(5), Income Tax 18 Regs .) For example, Petitioner claimed many trips to 19 DFW International Airport in 2003 ; however, the fact 20 that Petitioner may perhaps have worked in more than 21 one terminal at the airport on any one day does not 22 serve to convert the 80 miles to and from the airport 23 into business miles . And we do not accep t 24 uncritically Petitioner's testimony regarding the use 25 of one of his personally owned vehicles to travel Heritage Reporting Corporation (202) 628-4888 2 0 1 between his residence and his employer's "workshop, " 2 followed by the use of another of his personally owned 3 vehicles to travel between his employer's "workshop " 4 and the customers' premises . Finally, we note tha t 5 Petitioner's log does not demonstrate that Petitioner 6 performed services for his employer at multipl e 7 locations on any given day . 8 In addition, we note that Petitioner' s 9 return preparer admitted at trial that the mileage 10 numbers reported on Petitioner's Schedule C were 11 determined in part on the basis of estimates . 12 In short, Petitioner has failed to satisfy 13 the substantiation requirements imposed by law t o 14 prove entitlement to the deduction in issue . 15 Accordingly, we sustain Respondent's determination 16 disallowing the deduction . 17 XI . 18 Finally, we address the addition to tax 19 under Section 6651(a)(1) for failure to timely file . 20 We begin by observing that Section 7491(c) 21 places the burden of production on the Commissioner to 22 make, in effect, a prima facie case that the addition 23 is appropriate . Here Respondent has satisfied tha t 24 burden by demonstrating that his Austin, Texas, 25 Service Center did not receive Petitioner's 2002 Heritage Reporting Corporatio n (202) 628-4888 2 1 1 return until September 19, 2003, more than a month 2 after the due date for that return, as extended, of .3 Friday, August 15, 2003 . 4 At trial, Petitioner testified that, " I 5 don't know anything about my tax being late ." This 6 statement does not satisfy Petitioner ' s burden o f 7 proving that the late filing was due to reasonable 8 cause and not willful neglect . See United States v . 9 Boyle , 469 U .S . 241 (1975) ; Sec . 301 .6651-1(c)(1) , 10 Proced . & Admin . Regs . Accordingly, we sustai n 11 Respondent's determination and hold that Petitioner is 12 liable for the addition to tax under Sectio n 13 6651(a)(1) . 14 XII . 15 In order to give effect to our disposition 16 of the disputed issues, decision will be entered for 17 Respondent . 18 XIII . 19 THIS CONCLUDES THE COURT'S ORAL FINDINGS OF 20 FACT AND OPINION IN THIS CASE . 21 (Whereupon, at 9 :46 a .m ., the bench opinion 22 in the above-entitled matter was concluded . ) 23 24 25 Heritage Reporting Corporation (202) 628-4888