Regarding the accuracy-related penalty under I.R.C. § 6662, the court acknowledged that although the respondent (Commissioner of Internal Revenue) initially asserted the penalty based on negligence, the petitioner had substantial authority supporting its position that the grant could be excluded from income. Therefore, the court concluded that the accuracy-related penalty should not apply due to the reasonable basis for the taxpayer’s treatment of the grant proceeds.

https://www.taxnotes.com/research/federal/court-documents/court-opinions-and-orders/tax-court-holds-9-11-aid-not-excludable-income/7rjfp?highlight=United+States+Tax+Court+REVIEWED+164+T.C.+No.+5+CE+HEADQUARTERS+CORPORATION%2C+Petitioner+COMMISSIONER+OF+INTERNAL+REVENUE%2C+Respondent