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additions to tax under section 6653; (3) the taxpayers grossly
overvalued the subject master recording and were liable for the
addition to tax under section 6659 due to a valuation
overstatement; (4) the taxpayers were liable for the increased
rate of interest under section 6621(c) due to an underpayment of
tax in excess of $1,000 attributable to one or more enumerated
“tax motivated transactions”; and (5) the taxpayers were liable
for a penalty under section 6673 as a result of advancing
frivolous and groundless arguments.
Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the year at issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
In Feldman v. Commissioner, supra, and Garcia v.
Commissioner, supra, the Court held: (1) The taxpayers'
underpayments for the years at issue were due to negligence or
intentional disregard of rules and regulations, and as a result,
the taxpayers were liable for the additions to tax under section
6653; (2) the taxpayers grossly overvalued the subject master
recording and were liable for the addition to tax under section
6659 due to a valuation overstatement; and (3) the taxpayers were
liable for a penalty under section 6673 as a result of advancing
frivolous and groundless arguments.
Petitioners have not agreed to be bound by the previously
decided cases; however, after concessions by the parties, the
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