Friday, November 12, 2010
Petitioners contend that they followed the instructions on the [Tax Cut] tax preparation software that they used in preparing their 2006 tax return, asserting that the software was "approved by the IRS". They indicate that they were unaware of the provisions of the Code and that they did not consult any Internal Revenue Service (IRS) publications or professional tax advisers before claiming deductions equaling almost half of their reported income in 2006. ...
The software instructions are not in the record, so we cannot determine how the error occurred. We doubt that the instructions, if correctly followed, permitted a result contrary to the express language of the Code. Petitioners may have acted in good faith but made a mistake. In the absence of evidence of a mistake in the instructions or a more thorough effort by petitioners to determine their correct tax liability, we cannot conclude that they have shown reasonable cause for the underpayment of tax on their 2006 return.
- Tax Update Blog, 'TurboTax Defense' Not Golden for Au
Prior TaxProf Blog coverage:
- Tax Court Rejects Taxpayer's Attempt to Use Geithner's TurboTax Defense (Aug. 26, 2009)
- Tax Court Rejects "Geithner Defense," Says Reliance on TurboTax Does Not Excuse Taxpayer From Penalty for Errors on Tax Return (Apr. 20, 2010)
- Tax Court Rejects Geithner/TurboTax Defense (June 23, 2010)