Paul L. and Doris J. Triemstra, et al. - Page 13

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          recyclers considered in these cases are the same type of machines           
          considered in the Provizer case.                                            
               Based on the entire record in these cases, including the               
          extensive stipulations, testimony of respondent's experts, and              
          cross-examination of them, and petitioners' testimony, we hold              
          that the Northeast transaction was a sham and lacked economic               
          substance.  In reaching this conclusion, we rely heavily upon the           
          overvaluation of the Sentinel EPE recyclers.  Respondent is                 
          sustained on the question of the underlying deficiency.  We note            
          that petitioners explicitly conceded this issue at trial, in                
          their briefs, and in a stipulation of settled issues.  The record           
          plainly supports respondent's determination regardless of such              
          concession.  For a detailed discussion of the facts and the                 
          applicable law in a substantially identical case, see Provizer v.           
          Commissioner, supra.                                                        
               In the notices of deficiency respondent determined that                
          petitioners were liable for the negligence additions to tax under           
          section 6653(a)(1) and (2) for 1981.  Petitioners have the burden           
          of proving that respondent's determination is erroneous.  Rule              
          142(a); Luman v. Commissioner, 79 T.C. 846, 860-861 (1982).                 
               Section 6653(a)(1) imposes an addition to tax equal to 5               
          percent of the underpayment if any part of an underpayment of tax           
          is due to negligence or intentional disregard of rules or                   
          regulations.  In cases involving negligence, an additional amount           
          is added to the tax under section 6653(a)(2); such amount is                

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