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amount is significant, even on petitioners' tax return.
Moreover, petitioner reported total tax of $97,751 for 1981, but
reached that figure by claiming $39,604 in investment tax and
business energy credits related to Hyannis and an operating loss
of $20,326. Consequently, we consider the trivialization
argument inappropriate and inaccurate. Petitioners' tax benefits
claimed with respect to Hyannis were not negligible--even for
them.
Petitioners have not distinguished their situation from that
of the taxpayers in Provizer v. Commissioner, supra, where the
negligence additions to tax were upheld. We hold, upon
consideration of the entire record, that petitioners are liable
for the negligence additions to tax under the provisions of
section 6653(a)(1) and (2). Respondent is sustained on this
issue.
Issue 2. Sec. 6659 Valuation Overstatement
Respondent determined that petitioners are liable for the
section 6659 addition to tax for valuation overstatement on the
portion of their 1981 underpayment attributable to the tax
benefits claimed with respect to Hyannis. A graduated addition
to tax is imposed when an individual has an underpayment of tax
that equals or exceeds $1,000 and "is attributable to" a
valuation overstatement. Sec. 6659(a), (d). A valuation
overstatement exists if the fair market value (or adjusted basis)
of property claimed on a return equals or exceeds 150 percent of
the amount determined to be the correct amount. Sec. 6659(c).
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