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petitioners' 1986 and 1987 returns, the revenue agent examined an
expense diary for 1986. This diary and possibly other records as
well were lost by Mr. Kelly in the course of an office move.
The regulations provide an exception to the normal substantiation
requirements where the taxpayer can establish that at one time he
possessed adequate records and that his inability to produce them
is attributable to fire, flood, or other casualty beyond his
control. In such cases the taxpayer may satisfy his burden of
proof by reasonably reconstructing his records. Sec. 1.274-
5(c)(5), Income Tax Regs. It is doubtful that loss of
documentation in transit is a casualty beyond the taxpayer's
control within the meaning of section 1.274-5(c)(5), Income Tax
Regs. Gizzi v. Commissioner, 65 T.C. 342, 345 (1975); Silver v.
Commissioner, T.C. Memo. 1972-102. In any event, Mr. Kelly has
not attempted to reconstruct the lost records.
4(a) Additions to Tax for 1986 and 1987
Respondent determined that petitioners are liable for
additions to tax for negligence under section 6653(a) for taxable
years 1986 and 1987. Section 6653(a) provides for an addition
to tax if any part of an underpayment of tax is attributable to
negligence. The amount of the addition is 5 percent of the
entire underpayment plus 50 percent of the interest payable with
respect to the portion of the underpayment attributable to
negligence. Sec. 6653(a)(1)(A) and (B). Negligence is defined
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