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Procedure.
At the time the petition was filed, petitioner resided in
Laguna Niguel, California.
In January of 1992, respondent began an audit of
petitioner’s 1988 Federal income tax return (1988 return).
During the audit, petitioner did not appear at any of the
conferences scheduled with respondent’s representatives, and
petitioner did not provide respondent any requested information.
Instead, petitioner forwarded all correspondence from respondent
to Gary Dragna (Dragna), his alleged representative.
In the late spring of 1992, Dragna wrote to respondent
claiming to have a power of attorney (POA) from petitioner and
demanding that respondent cease any further examination of
petitioner’s 1988 return. Respondent could not locate a copy of
a POA for Dragna with respect to petitioner, and respondent
notified petitioner and Dragna accordingly.
In light of petitioner’s failure to provide requested
information to respondent’s representative, on July 27, 1992,
respondent issued a notice of deficiency to petitioner
disallowing a $17,862 loss deduction claimed on the 1988 return
relating to a purported farming activity. Therein, respondent
determined a deficiency in petitioner’s Federal income tax for
1988 of $5,055 and additions to tax for failure to timely file an
income tax return and for negligence. On October 27, 1992,
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