Opinion
5017-21S
03-09-2022
Julie Annette Keller Petitioner v. Commissioner of Internal Revenue Respondent
ORDER AND DECISION
Ronald L. Buch, Judge.
On March 7, 2022, the Court received from the parties in a proposed stipulated decision resolving this case. In the proposed stipulated decision, the parties agreed to a deficiency of $579.00 for 2017. The proposed stipulated decision does not mention penalties. In addition to determining a deficiency in tax, the notice of deficiency underlying this case determined a substantial understatement penalty under section 6662, however the parties' proposed decision fails to address that penalty. We note, however, that the substantial understatement penalty applies when "the understatement for the taxable year exceeds the greater of (i) 10 percent of the tax required to be shown on the return for the taxable year, or (ii) $5,000." I.R.C. § 6662(d)(1)(A). Given that the agreed deficiency is below $5,000, and that the parties failed to address the substantial understatement penalty in their agreed decision, we will deem the Commissioner to have fully conceded that penalty. Accordingly, it is
ORDERED that the Clerk shall recharacterize the Proposed Stipulated Decision, filed March 7, 2022, as a Stipulation of Settlement. It is further
ORDERED and DECIDED that there is a deficiency in income tax due from the petitioner for the taxable year 2017 in the amount of $579.00, and that there is no penalty under I.R.C. § 6662(a) due from the petitioner for the taxable year 2017.