- 16 - investment alone, petitioners claimed an operating loss in the amount of $20,326 and investment tax and business energy credits related to Hyannis totaling $39,604, while petitioners' investment in Hyannis was $25,000. The direct reductions in petitioners' Federal income tax, from just the tax credits, equaled 158 percent of their cash investment. Given petitioners' combined gross income of $363,705 for 1981, we find petitioner's alleged lack of interest in the tax benefits generated by Hyannis unconvincing. Also, we are unpersuaded by petitioners' efforts to trivialize this case. The argument is that because of petitioner's heavy business responsibilities, his great wealth, and his substantial income, he could not be expected to spend much time on a mere $25,000 investment. In petitioner's words "because of the comparatively minimal amount, it did not get the diligence or the discretion that probably should have been given to it". In our view, despite petitioner's numerous and significant responsibilities, he is required to exercise due care with respect to his Federal income taxes. Obviously, there is no rule permitting wealthy people to be negligent with respect to claims of tax benefits but imposing penalties on those with less income who claim the same benefits. Moreover, the record here demonstrates that the tax benefits of the Hyannis deal were not trivial to petitioner. While petitioner paid $25,000 for his share of Hyannis, on his 1981 tax return he indicated ownership of investment property of $198,016 related to Hyannis, and thatPage: Previous 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Next
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