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was presented to the Court to prove that disallowance and
concession of the claimed tax benefits related to anything other
than a valuation overstatement, we conclude that the deficiency
caused by the disallowance of the claimed tax benefits was
attributable to the overvaluation of the Sentinel EPE recyclers.
Finally, we consider petitioners' express argument as to
waiver of the addition to tax. On brief, petitioners contested
imposition of the section 6659 addition to tax on the grounds
that respondent erroneously failed to waive the penalty. Section
6659(e) authorizes respondent to waive all or part of the
addition to tax for valuation overstatements if taxpayers
establish that there was a reasonable basis for the adjusted
bases or valuations claimed on the returns and that such claims
were made in good faith. Respondent's refusal to waive a section
6659 addition to tax is reviewable by this Court for abuse of
discretion. Krause v. Commissioner, 99 T.C. at 179.
Petitioner arrived at the claimed valuation by virtue of his
purported reliance on Miller and Roberts, in addition to the
representations and evaluations contained in the offering
memorandum. He contends that such reliance was reasonable and,
therefore, respondent should have waived the section 6659
addition to tax.
We have found that petitioner's purported reliance on
Miller, Roberts, and the offering memorandum was not reasonable.
Miller was corporate counsel to PI, and Roberts was a promoter of
Hyannis. See Vojticek v. Commissioner, T.C. Memo. 1995-144,
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