Richard Santulli and Virginia Santulli - Page 32

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               D.  Conclusion                                                         
               During the years in issue, petitioner was not at risk on               
          account of either installment note.  We therefore uphold                    
          respondent's determinations of deficiencies in tax as they relate           
          thereto.                                                                    
          II.  Additions to Tax                                                       
               A.  Negligence                                                         
               Section 6653(a) imposes one addition to tax, and, in some              
          cases, two additions to tax, where the taxpayer's underpayment is           
          due to negligence or intentional disregard of rules or                      
          regulations (hereinafter referred to simply as negligence).                 
          Section 6653(a), as applicable for 1980, and section 6653(a)(1),            
          as applicable for 1981 through 1983, impose an addition to tax              
          equal to 5 percent of the entire underpayment if any portion of             
          such underpayment is due to negligence.  Section 6653(a)(2), as             
          applicable for 1981 through 1983, imposes an addition to tax                
          equal to 50 percent of the interest payable under section 6601              
          with respect to the portion of the underpayment due to negligence           
          (the interest-sensitive addition to tax).  Petitioners bear the             
          burden of proof.  Rule 142(a).                                              
               An underpayment, for purposes of section 6653(a), is the               
          amount by which the tax liability exceeds the tax shown on a                
          timely filed return.  Secs. 6653(c)(1), 6211(a).  The parties               
          have stipulated that petitioners did not timely file their 1980             
          and 1981 Federal income tax returns.  Therefore, for 1980 and               




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