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Unless otherwise noted, all section references are to the
Internal Revenue Code in effect for the years in issue, and all
Rule references are to the Tax Court Rules of Practice and
Procedure. The issues for decision are as follows: (1) Whether
petitioners are entitled to claim their 1989 and 1990 losses from
transactions in securities and futures contracts as ordinary
losses. We hold that they are not. (2) Whether petitioners are
liable for additions to tax for failure to file timely returns
under section 6651(a)(1). We hold that they are.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found. We
incorporate by this reference the stipulation of facts and
attached exhibits. Petitioners resided in Baldwin, New York, at
the time they filed their petition. They filed joint Federal
income tax returns for 1989 and 1990, the taxable years in issue.
Stephen Marrin (petitioner) had substantial experience in
trading and underwriting securities, having been employed in this
capacity by several securities firms starting in 1969, becoming a
registered securities principal in 1978, and starting a
securities firm, Egan Marrin and Rubano, Inc. (EMR), in 1983,
where he also dealt in securities as a registered securities
principal. All firms at which petitioner worked were registered
broker-dealers, and he undertook transactions on their behalf.
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