During 2000, Mr. Oria failed to report $ 32,580 of personal expenses charged on Medico's American Express card and paid by Medico.

During 2000, Mr. Oria deposited receipts of Medico's totaling $ 194,888.57 2007 Tax Ct. Memo LEXIS 227">*235 into his personal bank account. Those deposits were not entered in the general ledger and were not reported on Medico's 2000 Federal income tax return. Mr. Oria paid certain expenses of Medico's from his personal bank account; the excess of deposits made over expenses paid during 2000 is $ 27,550. Petitioners did not provide personal bank account records to Mr. Loeser.

During 2000, Mr. Oria failed to report $ 5,150 of golf club dues and other personal expenses paid by Medico.

OPINION

Section 6662 imposes an accuracy-related penalty in the amount of 20 percent of the portion of any underpayment attributable to, among other things, negligence.^{22007 Tax Ct. Memo LEXIS 227">*236} Sec. 6662(a), and (b)(1). Negligence has been defined as the failure to exercise the due care of a reasonable and ordinarily prudent person under like circumstances. Nis Family Trust v. Commissioner, 115 T.C. 523">115 T.C. 523, 115 T.C. 523">542 (2000). Negligence includes any failure to make a reasonable attempt to comply with the provisions of the internal revenue laws or to exercise ordinary and reasonable care in the preparation of a tax return. Sec. 1.6662-3(b)(1), Income Tax Regs.

The Commissioner bears the burden of production with respect to the accuracy-related penalty. Sec. 7491(c). In order to meet that burden, the Commissioner must produce sufficient evidence that it is appropriate to impose the penalty. Higbee v. Comm'r, 116 T.C. 438">116 T.C. 438, 116 T.C. 438">446 (2001). We may take a taxpayer's concession into account in determining whether the Commissioner has carried his burden. See, e.g., Rogers v. Comm'r, T.C. Memo. 2005-248. Petitioners have conceded that they understated their taxable income on account of: (1) erroneous credits to Mr. Oria's drawing account resulting from fictitious payments to Mr. Loeser or one of his affiliates, (2) Mr. Oria's personal expenses charged on Medico's American Express card, (3) Mr. Oria depositing Medico's receipts into his personal account, and (4) Medico's payment of Mr. Oria's golf club and other personal expenses. Petitioners' concessions are sufficient for us to conclude that respondent has carried his burden. Mr. Oria signed all of Medico's checks issued in 2000, and he generally performed all duties connected with its business. Given Mr. Oria's business degree, his experience in business, and his knowledge of 2007 Tax Ct. Memo LEXIS 227">*237 both Medico's and his own affairs, petitioners' tax treatment of the conceded items is not plausible. Mr. Oria failed to use the due care of a reasonable and ordinarily prudent person under like circumstances to insure that his own compensation from Medico was properly accounted for and reported.

The accuracy-related penalty does not apply to any part of an underpayment of tax if it is shown the taxpayer acted with reasonable cause and in good faith. Sec. 6664(c)(1). The determination of whether a taxpayer acted in good faith is made on a case-by-case basis, taking into account all the pertinent facts and circumstances. Sec. 1.6664-4(b)(1), Income Tax Regs. Generally, the most important factor is the extent of the taxpayer's effort to assess his proper tax liability. Id. The taxpayer bears the burden of proof that he had reasonable cause and acted in good faith with respect to the underpayment. 116 T.C. 438">Higbee v. Comm'r, supra at 447.

Petitioners defend against the accuracy-related penalty on the ground that they acted with reasonable cause and in good faith. They argue that the penalty should not apply because they relied on the advice of Mr. Loeser, a certified public accountant with 2007 Tax Ct. Memo LEXIS 227">*238 extensive experience in preparing tax returns.

The general rule is that a taxpayer has a duty to file a complete and accurate tax return and cannot avoid that duty by placing responsibility with an agent. United States v. Boyle, 469 U.S. 241">469 U.S. 241, 469 U.S. 241">252, 105 S. Ct. 687">105 S. Ct. 687, 83 L. Ed. 2d 622">83 L. Ed. 2d 622 (1985); Metra Chem Corp. v. Commissioner, 88 T.C. 654">88 T.C. 654, 88 T.C. 654">662 (1987). In limited situations, the good faith reliance on the advice of an independent, competent professional in the preparation of the tax return can satisfy the reasonable cause and good faith exception. 469 U.S. 241">United States v. Boyle, supra at 250-251; Weis v. Commissioner, 94 T.C. 473">94 T.C. 473, 94 T.C. 473">487 (1990). However, reliance on the advice of a professional tax adviser does not necessarily demonstrate reasonable cause and good faith. Sec. 1.6664-4(b)(1), Income Tax Regs. All facts and circumstances must be taken into account. Sec. 1.6664-4(c)(1), Income Tax Regs. The advice must be based upon all pertinent facts and the applicable law. Sec. 1.6664-4(c)(1)(i), Income Tax Regs. The advice must not be based on unreasonable factual or legal assumptions. Sec. 1.6664-4(c)(1)(ii), Income Tax Regs. The advice cannot be based on an assumption that the taxpayer knows, or has reason to know, is unlikely to 2007 Tax Ct. Memo LEXIS 227">*239 be true. Id.

At the close of the trial of this case, the Court instructed petitioners to address on brief the particular advice from Mr. Loeser on which they were relying to show reasonable cause and good faith with respect to each of the concede! d items of underreported taxable income. In their briefs, petitioners address only the transaction involving the fictitious payments to Mr. Loeser or one of his affiliates and resulting in the erroneous credits to Mr. Oria's drawing account. We assume, therefore, that they concede their reasonable cause and good faith defense with respect to the remaining conceded items of underreported taxable income. Mendes v. Comm'r, 121 T.C. 308">121 T.C. 308, 121 T.C. 308">312-313 (2003) ("If an argument is not pursued on brief, we may conclude that it has been abandoned.").

Petitioners concede that they underreported their 2000 taxable income in the amount of $ 248,524 by failing to report the total of the checks Mr. Oria received from Medico in that year. They claim that they did so on the advice of Mr. Loeser. They do not claim that Mr. Oria was not aware of the total of salary checks that, during 2000, he had signed on behalf of, and received from, Medico. They claim that 2007 Tax Ct. Memo LEXIS 227">*240 they relied on Mr. Loeser to prepare a correct income tax return for them. Mr. Oria was aware that Medico was participating in a plan designed by Mr. Loeser under which Medico was paying Mr. Loeser money so that, Mr. Loeser claimed, Mr. Oria could save on taxes. A reasonably prudent person would not rely on an adviser having an interest in the subject of the advice. Neonatology Assocs., P.A. v. Comm'r, 115 T.C. 43">115 T.C. 43, 115 T.C. 43">99 (2000), affd. 299 F.3d 221">299 F.3d 221 (3d Cir. 2002). Moreover, Mr. Oria made no attempt to understand the transactions Medico was engaging in to implement Mr. Loeser's plan. The detail of those transactions was spelled out in Medico's tax returns and the general ledger, yet Mr. Oria was uninterested in Mr. Loeser's explanation of those documents, regarding their contents as "mumbo jumbo numbers". The assumption underlying the erroneous credits posted to his drawing account was either that he had paid Mr. Loeser or one of his affiliates directly on Medico's behalf or that he had reimbursed Medico, which had paid Mr. Loeser or one of his affiliates. Had he paid ! attention to Mr. Loeser's explanations, Mr. Oria would have realized that the factual premises relied on by Mr. 2007 Tax Ct. Memo LEXIS 227">*241 Loeser were incorrect, since he had neither paid Mr. Loeser or one of his affiliates directly nor had he reimbursed Medico. A taxpayer cannot stick his head in the sand while an adviser explains the basis of his advice and pop it out only to hear the favorable conclusion. Considering all the facts and circumstances, we conclude, and find, that petitioners did not act with reasonable cause and in good faith in relying on Mr. Loeser to prepare a correct income tax return for them. The underpayment in tax attributable to the $ 248,524 in checks received from Medico and not reported on the Form 1040 is due to negligence, and there is not reasonable cause, nor did petitioners act in good faith, with respect to that portion of the underpayment.

We sustain the accuracy-related penalty determined by respondent with respect to petitioners' underpayment of tax for 2000.

Decision will be entered under Rule 155.