William S. Cook v. Commissioner

UNITED STATES TAX COURT
WILLIAM S. COOK, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 2037-98.
William S. Cook, pro se.
Robert W. Dillard, for respondent.
MEMORANDUM OPINION
CHIECHI, Judge: Respondent determined the following defi-
ciencies in, and additions to, petitioner's Federal income tax
(tax):
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Additions to Tax
Year Deficiency Sec. 6651(a)1 Sec. 6654(a)
1994 $20,835 $3,084 $303
1995 7,778 195 424
The only issues remaining for decision are whether peti-
tioner is liable for 1994 for the additions to tax under sections
6651(a) and 6654(a). We hold that he is.
Some of the facts have been stipulated and are so found.
Petitioner resided in Indialantic, Florida, at the time the
petition was filed.
At all relevant times, petitioner worked as a catastrophe
insurance claims adjuster. His income from that work depended,
inter alia, upon whether there was bad weather. Given the nature
of petitioner's work, it was difficult for him to determine the
amount of income that he would earn from year to year.
Petitioner filed his 1994 tax return on or about October 3,
1997. Petitioner contends that the reason that he filed his 1994
return late was because he wanted to make sure that he completed
that return accurately, and he was concerned that if he filed an
inaccurate return, he would be penalized.
Petitioner claims that he made estimated tax payments with
respect to the income that he expected to earn for 1994. He
1
All section references are to the Internal Revenue Code
in effect for the years at issue. All Rule references are to the
Tax Court Rules of Practice and Procedure.
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further contends that one of the reasons why he did not make the
appropriate amount of estimated tax payments for 1994 related to
certain unresolved tax issues for 1993 that were pending before
the Internal Revenue Service.
Petitioner has the burden to show that he is not liable for
the additions to tax under sections 6651(a) and 6654(a). Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933).
Section 6651(a)(1) imposes an addition to tax for failure to
file timely a tax return. The addition to tax does not apply if
the failure is due to reasonable cause, and not to willful
neglect. Sec. 6651(a)(1). Petitioner suggested at trial that
one of the reasons that he did not timely file his 1994 return
was because he did not know the amount of his income for 1994 as
of the time that return was due. We find that explanation hard
to believe, since petitioner is presumably a cash basis taxpayer
who would have known the amount of income that he earned during
1994 well before the due date of his 1994 return. In any event,
unavailability of information or records does not necessarily
establish reasonable cause for failure to file timely. See
Electric & Neon, Inc. v. Commissioner, 56 T.C. 1324, 1342-1344
(1971), affd. without published opinion 496 F.2d 876 (5th Cir.
1974). A taxpayer is required to file timely based on the best
information available and to file thereafter an amended return if
necessary. Estate of Vriniotis v. Commissioner, 79 T.C. 298, 311
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(1982). Nothing in the record suggests that petitioner applied
for an extension of time to file his 1994 return. Petitioner did
not show that as of the due date of his 1994 return he did not
have information showing the amount of his income for 1994. Nor
did he establish that he could not have prepared a timely 1994
return with a reasonable degree of accuracy based on the informa-
tion available to him as of the due date of that return. On the
record before us, we find that petitioner has not demonstrated
that the failure to file timely his 1994 return was due to
reasonable cause, and not to willful neglect. We further find on
that record that petitioner is liable for 1994 for the addition
to tax under section 6651(a)(1).
Section 6654(a) imposes an addition to tax in the case of
any underpayment of estimated tax by an individual. The addition
to tax under section 6654(a) is mandatory unless petitioner
qualifies under one of the exceptions in section 6654(e). See
Grosshandler v. Commissioner, 75 T.C. 1, 20-21 (1980). Peti-
tioner claims that he made estimated tax payments with respect to
the income that he expected to earn for 1994 and that one of the
reasons why he did not make the appropriate amount of estimated
tax payments for that year related to certain unresolved tax
issues for 1993 that were pending before the Internal Revenue
Service. Petitioner does not argue, and did not prove, that he
qualifies under any of the exceptions listed in section 6654(e).
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On the instant record, we find that petitioner failed to prove
that he is not liable for 1994 for the addition to tax under
section 6654(a).
To reflect the foregoing and the concessions by the parties,
Decision will be entered
under Rule 155.