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Moreover, because there was no gross income in either 1992 or
1993, petitioners were not entitled to any deductions under
section 183(b)(2). In sum, petitioners were not entitled to any
deductions from their Amway activity for 1992 and 1993.
In view of our holding on the section 183 issue, we need not
address the section 162 issue.
Section 6662(a) provides for an accuracy-related penalty in
the amount of 20 percent of the portion of an underpayment of tax
attributable to, among other things, negligence or disregard of
rules or regulations. Sec. 6662(a) and (b)(1). Negligence is
defined to include any failure to make a reasonable attempt to
comply with the provisions of the Internal Revenue laws. Sec.
6662(c); sec. 1.6662-3(b)(1), Income Tax Regs. Moreover,
negligence is the failure to exercise due care or the failure to
do what a reasonable and prudent person would do under the
circumstances. Neely v. Commissioner, 85 T.C. 934, 947 (1985).
Disregard is defined to include any careless, reckless, or
intentional disregard of rules or regulations. Sec. 6662(c);
sec. 1.6662-3(b)(2), Income Tax Regs.
Respondent also has met the burden of proof on this issue.
Petitioner possesses an accounting degree, is a Certified Public
Accountant, and has been a revenue agent with the Service for the
past 10 years. Given his experience and extensive background in
tax-related matters, it is apparent that petitioner failed to
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