[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 507]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
Procedure and Administration--Table of Contents
 
Sec.  1.6664-0  Table of contents.

    This section lists the captions in Sec. Sec.  1.6664-1 through 
1.6664-4T.

  Sec.  1.6664-1 Accuracy-related and fraud penalties; definitions and 
                             special rules.

    (a) In general.
    (b) Effective date.
    (1) In general.
    (2) Reasonable cause and good faith exception to section 6662 
penalties.
    (i) For returns due after September 1, 1995.
    (ii) For returns filed after December 31, 2002.

                      Sec.  1.6664-2 Underpayment.

    (a) Underpayment defined.
    (b) Amount of income tax imposed.
    (c) Amount shown as the tax by the taxpayer on his return.
    (1) Defined.
    (2) Effect of qualified amended return.
    (3) Qualified amended return defined.
    (4) Special rule for qualified amended returns.
    (d) Amounts not so shown previously assessed (or collected without 
assessment).
    (e) Rebates.
    (f) Underpayments for certain carryback years not reduced by amount 
of carrybacks.
    (g) Examples.

   Sec.  1.6664-3 Ordering rules for determining the total amount of 
                           penalties imposed.

    (a) In general.
    (b) Order in which adjustments are taken into account.
    (c) Manner in which unclaimed prepayment credits are allocated.
    (d) Examples.

Sec.  1.6664-4 Reasonable cause and good faith exception to section 6662 
                               penalties.

    (a) In general.
    (b) Facts and circumstances taken into account.
    (1) In general.
    (2) Examples.
    (c) Reliance on opinion or advice.
    (1) Fact and circumstances; minimum requirements.
    (i) All facts and circumstances considered.
    (ii) No unreasonable assumptions.
    (iii) Reliance on the invalidity of a regulation.
    (2) Advice defined.
    (3) Cross-reference.
    (d) Underpayments attributable to reportable transactions.
    (e) Pass-through items.
    (f) Special rules for substantial understatement penalty 
attributable to tax shelter items of corporations.
    (1) In general; facts and circumstances.
    (2) Reasonable cause based on legal justification.
    (i) Minimum requirements.
    (A) Authority requirement.
    (B) Belief requirement.
    (ii) Legal justification defined.
    (3) Minimum requirements not dispositive.
    (4) Other factors.
    (g) Transactions between persons described in section 482 and net 
section 482 transfer price adjustments. [Reserved]
    (h) Valuation misstatements of charitable deduction property.
    (1) In general.
    (2) Definitions.
    (i) Charitable deduction property.
    (ii) Qualified appraisal.
    (iii) Qualified appraiser.
    (3) Special rules.

  Sec.  1.6664-4T Reasonable cause and good faith exception to section 
                             6662 penalties

    (a)-(c) [Reserved]
    (d) Transactions between persons described in section 482 and net 
section 482 transfer price adjustments.

[T.D. 8381, 56 FR 67505, Dec. 31, 1991, as amended by T.D. 8519, 59 FR 
4799, Feb. 2, 1994; T.D. 8617, 60 FR 45666, Sept. 1, 1995; T.D. 8656, 61 
FR 4885, Feb. 9, 1996; T.D. 8790, 63 FR 66435, Dec. 2, 1998; T.D. 9109, 
68 FR 75128, Dec. 30, 2003]