Tuesday, December 22, 2015
Former MLB slugger Mo Vaughn lost his bid to have the penalties assessed against him for failing to timely file his 2007 tax return thrown out. In Vaughn v. United States, the 6th Circuit Court of Appeals ruled that Vaughn must accept the penalty even though his financial manager was responsible for filing. This is because Vaughn did not meet the "reasonable cause" penalty exception in § 6651 which does not apply to instances when deadlines are not met because an agent of the taxpayer was assigned responsibility to file but did not do so. In addition, the court noted that there has to be some disability that renders the taxpayer incapable of objectively exercising ordinary business care in selecting an agent for the failure to file by that agent not be imputed to the principle.
See Timothy M. Todd, 6th Circuit Rules Former Baseball Slugger Not Excused From Tax Penalty, Forbes, December 19, 2015.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.