Court Opinion

ID: 9370488
Source: CourtListenerOpinion
Date Created: 2023-02-13 20:01:21.270485+00
Date Added: 2024-06-11T16:48:52.896461
License: Public Domain

United States Tax Court

                         T.C. Summary Opinion 2023-5

                              FRANCIS KEMEGUE,
                                  Petitioner

                                           v.

               COMMISSIONER OF INTERNAL REVENUE,
                           Respondent

                                     —————

Docket No. 8987-20S.                                      Filed February 13, 2023.

                                     —————

Elizabeth W. Segovis, for petitioner.

Xheni D. Gallagher and Clara L. Raymond, for respondent.

                              SUMMARY OPINION

       CARLUZZO, Chief Special Trial Judge: This case was heard
pursuant to the provisions of section 7463 1 of the Internal Revenue Code
in effect when the petition was filed. Pursuant to section 7463(b), the
decision to be entered is not reviewable by any other court, and this
opinion shall not be treated as precedent for any other case.

       In a notice of deficiency dated February 18, 2020, respondent
determined a deficiency in petitioner’s 2017 federal income tax and
imposed an addition to tax for failure to file pursuant to section
6651(a)(1), an addition to tax for failure to pay pursuant to section
6651(a)(2), and an addition to tax for failure to pay proper estimated tax
pursuant to section 6654. Petitioner has conceded that he is liable for a
deficiency in an amount set forth in the parties’ Stipulation of Settled

        1 Unless otherwise indicated, all statutory references are to the Internal

Revenue Code, Title 26 U.S.C., in effect at all relevant times, all regulation references
are to the Code of Federal Regulations, Title 26 (Treas. Reg.), in effect at all relevant
times, and all Rule references are to the Tax Court Rules of Practice and Procedure.

                                 Served 02/13/23
                                     2

Issues. Respondent has conceded that petitioner is not liable for an
addition to tax pursuant to section 6654. The issue remaining for
decision is whether petitioner is liable for additions to tax pursuant to
section 6651(a)(1) and (2).

                               Background

        Petitioner resided in Massachusetts when he timely filed his
Petition. During 2017 he lost his job and experienced multiple personal
and professional setbacks. In April 2018, petitioner timely requested an
extension for filing his 2017 tax return until October 2018. He did not,
however, file a tax return for 2017. Respondent subsequently prepared
a substitute for return for petitioner for 2017 on the basis of third-party
reporting. See § 6020(b). Petitioner did not pay the 2017 income tax
liability shown on respondent’s substitute for return.

                                Discussion

       Section 6651(a)(1) provides for an addition to tax in the event a
taxpayer fails to file a timely return, determined with regard to any
extension of time for filing, unless it is shown that such failure is due to
reasonable cause and not due to willful neglect. Section 6651(a)(2)
provides for an addition to tax for failure to timely pay the amount of
tax shown on a return, unless it is shown that such failure is due to
reasonable cause and not due to willful neglect. Under section 7491(c),
the Commissioner bears the burden of production with respect to
additions to tax, and petitioner does not suggest that respondent has
failed to satisfy that burden. If the Commissioner meets the burden, the
taxpayer has the burden of providing that failure to timely file or pay
was due to reasonable cause and not willful neglect. See § 6651(a)(1)
and (2); Higbee v. Commissioner, 116 T.C. 438, 447 (2001).

      Whether “reasonable cause” and lack of “willful neglect” exist is a
question of fact, and the burden of establishing these facts is on the
taxpayer. United States v. Boyle, 469 U.S. 241, 245 (1985). To prove
reasonable cause for a failure to timely file, the taxpayer must show that
he or she exercised ordinary business care and prudence and was
nevertheless unable to file the return within the prescribed time.
Crocker v. Commissioner, 92 T.C. 899, 913 (1989); Treas. Reg.
§ 301.6651-1(c)(1). A taxpayer may have reasonable cause for failure to
timely file a return where he or she experiences an illness or incapacity
that prevents him or her from filing the return. Boyle, 469 U.S.
at 248 n.6; Jordan v. Commissioner, T.C. Memo. 2005-266.
                                     3

       Petitioner testified to the professional and personal difficulties he
experienced following the loss of his job in 2017. He did not, however,
offer any explanation or evidence of any specific incapacity or illness
during the time for filing his return; on the contrary, he testified to his
efforts to seek other employment, including traveling to other states and
trying to start his own business. Petitioner has not shown reasonable
cause for his failure to file his 2017 return and is liable for the addition
to tax pursuant to section 6651(a)(1) for the year in issue.

       When a taxpayer has not filed a return, the section 6651(a)(2)
addition to tax may not be imposed unless the Secretary has prepared a
substitute for return. See Wheeler v. Commissioner, 127 T.C. 200, 210
(2006), aff’d, 521 F.3d 1289 (10th Cir. 2008). Respondent introduced
into evidence a substitute for return for 2017 that satisfies section
6020(b). See Cabirac v. Commissioner, 120 T.C. 163, 170–72 (2003), aff’d
per curiam without published opinion, No. 03-3157, 2004 WL 7318960
(3d Cir. Feb. 10, 2004).

       Petitioner does not dispute that he failed to pay his federal income
tax obligation for 2017. He has not shown reasonable cause and is liable
for the addition to tax pursuant to section 6651(a)(2).

      To reflect the foregoing,

      Decision will be entered under Rule 155.