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There is a substantial understatement of income tax if the
amount of the understatement for the taxable year exceeds the
greater of (1) 10 percent of the amount required to be shown on the
tax return or (2) $5,000. Sec. 6662(d)(1)(A). The amount of the
understatement is reduced, however, if there was substantial
authority for the taxpayer’s treatment of the item. Sec.
6662(d)(2)(B). In order to satisfy the substantial authority
standard, petitioners must show that the weight of authorities
supporting their position is substantial in relation to those
supporting a contrary position. Antonides v. Commissioner, 91 T.C.
686, 702 (1988), affd. 893 F.2d 656 (4th Cir. 1990).
Petitioners have the burden of proving that respondent’s
determination of the accuracy-related penalty is in error. Rule
142(a). Petitioners have failed to provide any evidence to show
that they were not negligent (indeed the record reveals otherwise),
and they have not pointed to any authorities to support their
position and bring them within the exception to the definition of
substantial understatement. Thus, we sustain respondent’s
determination with regard to this issue.
To reflect the foregoing,
Decision will be entered
under Rule 155.
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