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Petitioner has made no argument specifically directed to
respondent’s determination of negligence and has failed to
introduce evidence sufficient to overcome the prima facie
evidence of negligence furnished by his failure to file a return
for 1988. As noted above, we have rejected petitioner’s claim
that he relied on any statement by Ms. Murphy that his taxes were
paid through 1991. Based on our consideration of the entire
record, we sustain respondent’s determination with respect to the
addition to tax for negligence for 1988.
Section 6661(a) Addition to Tax
Respondent determined that, for 1987, petitioner was liable
for the addition to tax for a substantial understatement of
income tax provided by section 6661(a). The addition to tax is
equal to 25 percent of the amount of any underpayment of tax
attributable to a substantial understatement of income tax.
Pallottini v. Commissioner, 90 T.C. 498 (1988). The amount of
the understatement is equal to the amount of tax required to be
shown on the return less the amount of tax shown on the return.
Sec. 6661(b)(2)(A). For individuals, an understatement is
substantial if it exceeds the greater of 10 percent of the tax
required to be shown on the return or $5,000. The amount of the
understatement is reduced by the portion that is attributable to
an item for which there is or was substantial authority for the
position taken on the return or which was adequately disclosed on
the return. Sec. 6661(b)(2)(B).
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