1. (a) A penalty shall not be imposed with respect to a portion of an underpayment if the taxpayer shows that there was reasonable cause for the underpayment and that the taxpayer acted in good faith.

2. (b) Relief for reasonable cause is available for the following penalties:

   1. (1) Accuracy-related penalty under § 47-4211;
   2. (2) Failure to pay penalty under § 47-4213;
   3. (3) Failure to file penalty under § 47-4213;
   4. (4) Return preparer penalties under § 47-4217;
   5. (5) Personal liability for failure to collect or pay tax under § 47-4491; and
   6. (6) Failure to record timely a deed under § 47-1433.
3. (c) Reasonable cause generally exists if, based on all the facts and circumstances, the taxpayer exercises ordinary business care and prudence in determining his or her tax obligations, but was unable to comply with a prescribed duty within the prescribed time. Ordinary business care and prudence includes making provision for business obligations to be met when reasonably foreseeable events occur.

History

June 9, 2001, D.C. Law 13-305, § 403(b), 48 DCR 334

Apr. 4, 2003, D.C. Law 14-282, § 11(zz), 50 DCR 896

Emergency Legislation

For temporary (90 day) amendment of section, see § 12(iii) of Tax Clarity and Related Amendments Congressional Review Emergency Act of 2002 (D.C. Act 14-510, October 23, 2002, 49 DCR 10247).

For temporary (90 day) amendment of section, see § 12(iii) of Tax Clarity and Related Amendments Emergency Act of 2002 (D.C. Act 14-456, July 23, 2002, 49 DCR 8107).

For temporary (90 day) amendment of section, see § 12(hhh) of Tax Clarity and Recorder of Deeds Emergency Act of 2002 (D.C. Act 14-381, June 6, 2002, 49 DCR 5674).

For temporary (90 days) amendment of this section, see § 201(b) of COVID-19 Response Emergency Amendment Act of 2020 (D.C. Act 23-247, Mar. 17, 2020, 67 DCR 3093).

For temporary (90 days) amendment of this section, see § 207(d) of Coronavirus Support Emergency Amendment Act of 2020 (D.C. Act 23-326, May 27, 2020, 67 DCR 7045).

For temporary (90 days) amendment of this section, see § 207(d) of Coronavirus Support Congressional Review Emergency Amendment Act of 2020 (D.C. Act 23-328, June 8, 2020, 67 DCR 7598).

For temporary (90 days) amendment of this section, see § 207(d) of Coronavirus Support Second Congressional Review Emergency Amendment Act of 2020 (D.C. Act 23-405, Aug. 19, 2020, 67 DCR 10235).

Temporary Legislation

For temporary (225 day) amendment of section, see § 12(iii) of Tax Clarity and Related Amendments Temporary Act of 2003 (D.C. Law 14-228, March 23, 2003, law notification 50 DCR 2741).

For temporary (225 day) amendment of section, see § 12(iii) of Tax Clarity and Recorder of Deeds Temporary Act of 2002 (D.C. Law 14-191, October 5, 2002, law notification 49 DCR 9549).

For temporary (225 days) amendment of this section, see § 207(d) of Coronavirus Support Temporary Amendment Act of 2020 (D.C. Law 23-130, Oct. 9, 2020, 67 DCR 8622).

Effect of Amendments

D.C. Law 14-282 made nonsubstantive changes in subsecs. (b)(4) and (b(5); and added subsec. (b)(6).

Section References

This section is referenced in § 47-1433 and § 47-4491.