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to show that any reliance on Mr. McVeigh with respect to the
erroneous use of the 25-percent limit, rather than the 15-percent
limit, in computing the deductions relating to his SEP contribu-
tions for 1989 and 1991 was reasonable or in good faith. Conse-
quently, we sustain respondent's determinations imposing the
accuracy-related penalty on the portion of the underpayment for
each such year that is attributable to that error.
Petitioner's Failure to Pay Excise
Tax on Excess Contributions to the SEP
Respondent determined that petitioner is liable for each of
the years at issue for the accuracy-related penalty under section
6662(a) on the underpayment of excise tax attributable to peti-
tioner's excess contribution to the SEP for each such year on the
ground that each such underpayment is attributable to a substan-
tial understatement of income tax within the meaning of section
6662(d). Respondent's determinations are wrong. The under-
payment of excise tax for each of the years at issue is not
attributable to a substantial understatement of income tax for
each such year within the meaning of section 6662(b)(2) and (d).
See sec. 6662(b)(4), (d)(1)(A); secs. 1.6662-4(a), 1.6664-2(b),
Income Tax Regs. Consequently, we reject respondent's determina-
tions imposing the accuracy-related penalty on the underpayments
of excise tax for the years at issue.
To reflect the foregoing and the concessions of the parties,
Decision will be entered
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