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1.6001-1(a), Income Tax Regs. Despite our continuance of the
case on July 15, 2003, to permit petitioner to provide documents,
and our orders to petitioner to produce documents, petitioner did
not provide to respondent any documents relating to those lists
(except for those related to the three pieces of equipment
described above at paragraph 1 of the findings of fact).
3. Conclusion
Petitioner has not shown that he had higher bases in
equipment sold in 1987-90 than the amounts conceded by
respondent. Thus, we sustain respondent’s determination
regarding the amounts of gain from petitioner’s sale of equipment
in 1987-90, except as reduced by respondent’s concession
regarding the three pieces of equipment.
B. Whether Petitioner Is Liable for Additions to Tax and the
Accuracy-Related Penalty
1. Negligence
a. Background
For tax years 1987 and 1988, taxpayers are liable for an
addition to tax equal to 5 percent of the underpayment of tax if
any part of the underpayment is due to negligence or intentional
disregard of rules or regulations. Sec. 6653(a). For tax years
1989 and later, taxpayers are liable for a penalty equal to 20
percent of the part of the underpayment attributable to
negligence or disregard of rules or regulations or to any
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