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attributable to the unreported $322,500 is attributable to
negligence. See sec. 6662(b); Niedringhaus v. Commissioner, 99
T.C. 202, 220 (1992). However, the portion of the underpayment
of tax attributable to the rent-free use of the new apartment in
1989 is not insulated from the section 6662 penalty.
Petitioners argue that petitioner reasonably relied on
the advice of Spyropoulos as to the tax ramifications of the
surrender agreement and the sublease agreement. Spyropoulos did
not provide petitioners with tax advice. Petitioners' argument
that they reasonably relied on Spyropoulos is without merit. We
conclude that the portion of the underpayment of tax attributable
to the rent-free use of the new apartment in 1989, and the entire
underpayments of tax for the taxable years 1990 and 1991 are
attributable to negligence.
To reflect the foregoing and the concessions by the parties,
Decision will be entered
under Rule 155.
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