The Tax Court holds that a partnership can assert a reasonable cause defense to section 6662 penalties. However, reliance on a promoter, defined as an “advisor who participates in structuring the transaction”, is not reasonable cause for purposes of avoiding the penalty.
Tag Archives: Section 6662
Petaluma FX Partners v. Commissioner
The Tax Court follows the instructions of the Court of Appeals for the D.C. Circuit on the question of jurisdiction over Sec. 6662 partner level penalties in a partnership level proceeding.