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case, petitioners' investigation of the Partnership transactions
and the Sentinel EPE recyclers was essentially limited to
conversations with Tomasetti, Frabotta, or Omohundro, in addition
to a review of the respective offering memoranda. Petitioners
argue that such investigation insulates them from the negligence
additions to tax.
Under some circumstances a taxpayer may avoid liability for
the additions to tax under section 6653(a) if reasonable reliance
on a competent professional adviser is shown. Freytag v.
Commissioner, 89 T.C. 849, 888 (1987), affd. 904 F.2d 1011 (5th
Cir. 1990), affd. 501 U.S. 868 (1991). Reliance on professional
advice, standing alone, is not an absolute defense to negligence,
but rather a factor to be considered. Id. In order for reliance
on professional advice to excuse a taxpayer from the negligence
additions to tax, the reliance must be reasonable, in good faith,
and based upon full disclosure. Id.; see Weis v. Commissioner,
94 T.C. 473, 487 (1990); Ewing v. Commissioner, 91 T.C. 396, 423-
424 (1988), affd. without published opinion 940 F.2d 1534 (9th
Cir. 1991); Pritchett v. Commissioner, 63 T.C. 149, 174-175
(1974).
Reliance on representations by insiders, promoters, or
offering materials has been held an inadequate defense to
negligence. LaVerne v. Commissioner, 94 T.C. 637, 652-653
(1990), affd. without published opinion 956 F.2d 274 (9th Cir.
1992), affd. without published opinion sub nom. Cowles v.
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