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defines the term “disregard” to include any careless, reckless,
or intentional disregard. See Neely v. Commissioner, 85 T.C.
934, 947 (1985).
Section 6662(a) and (b)(1) provides that if any portion of
an underpayment of tax is attributable to negligence or disregard
of rules or regulations, then there shall be added to the tax an
amount equal to 20 percent of the amount of the underpayment
which is so attributable. The term “negligence” includes any
failure to make a reasonable attempt to comply with the statute,
and the term “disregard” includes any careless, reckless, or
intentional disregard. Sec. 6662(c). Petitioners have the
burden of proving that respondent’s determination is in error.
Rule 142(a); Welch v. Helvering, 290 U.S. at 115.
Petitioners failed to report various items of income for the
1989 taxable year. Petitioners also failed to provide respondent
with complete information concerning their corporations’
operations and expenses for the entire 1986 and 1989 calendar
years. We have previously held, even factoring into account any
missing records caused by the Crestwood property floods, that
petitioners did not maintain adequate records. For example, the
Crestwood property flood is not an excuse that can be used by
petitioners for the 1989 records of PWIC and C.B. Crest because
the floods occurred in December 1987 and June 1988.
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