Legal Research

Tax Court rejects ?Geithner defense?

By Pamela

Tax season is over, but if you are worried about your tax returns and planning to use the “Geithner defense” should you be audited, the news is not good.  In Lam v. Commissioner, T.C. Memo. 2010-82 (Apr. 19, 2010), the U.S. Tax Court specifically held that blaming TurboTax for errors on her return did not excuse the taxpayer from penalties.  “At trial Ms. Lam did not attempt to show a reasonable cause for petitioners’ underpayment of taxes. Instead, she analogized her situation to that of the Secretary of the Treasury, Timothy Geithner. Citing a Wikipedia article, Ms. Lam essentially argues that, like Secretary Geithner, she used TurboTax, resulting in mistakes on her taxes.”  The comparison didn’t fly in this case.  However, the court left open the possibility that it could be successful in other cases, saying that petitioners have not “shown that any of the conceded issues were anything but the result of [their] own negligence or disregard of regulations,” and they therefore are liable for the penalties.

[PRM]

Full post as published by Cocky Law Blawg on April 21, 2010 (boomark / email).