[Code of Federal Regulations] [Title 26, Volume 13] [Revised as of April 1, 2004] From the U.S. Government Printing Office via GPO Access [CITE: 26CFR] [Page 472] TITLE 26--INTERNAL REVENUE CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY (CONTINUED) Procedure and Administration--Table of Contents Sec. 1.6661-1 Addition to tax in the case of a substantial understatement of tax liability. (a) In general. Section 6661 imposes an addition to tax (penalty) for an understatement of tax liability that constitutes a substantial understatement of income tax. This section prescribes the effective date of the penalty. The manner of computing understatements subject to the penalty is set forth in Sec. 1.6661-2. The definition of ``substantial authority'' is set forth in Sec. 1.6661-3. Rules concerning the adequacy of disclosure are set forth in Sec. 1.6661-4. The treatment of ``tax shelters'' is provided in Sec. 1.6661-5. The circumstances in which the penalty may or will be waived by the Commissioner are set forth in Sec. 1.6661-6. (b) Effective date. The penalty under section 6661 applies to returns the due date (determined without regard to extensions of the time for filing) of which is after December 31, 1982. The penalty does not apply to amended returns, so-called, if the due date for the return to which the amended return relates (determined without regard to extensions) is before January 1, 1983. [T.D. 8017, 50 FR 12014, Mar. 27, 1985]