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return. See Rev. Proc. 89-11, 1989-1 C.B. 797; Rev. Proc.
90-16, 1990-1 C.B. 477; Rev. Proc. 91-19, 1991-1 C.B. 523;
Rev. Proc. 92-23, 1992-1 C.B. 737; Rev. Proc. 93-33, 1993-2
C.B. 470; Rev. Proc. 94-36, 1994-1 C.B. 682; Rev. Proc. 94-
74, 1994-2 C.B. 823.
Before the 1993 amendment, section 6662(d)(2)(B)(ii)
provided as follows:
(B) Reduction for understatement due to
position of taxpayer or disclosed item.-- The
amount of the understatement under subparagraph
(A) shall be reduced by that portion of the
understatement which is attributable to--
* * * * * * *
(ii) any item with respect to
which the relevant facts affecting the
item's tax treatment are adequately
disclosed in the return or in a
statement attached to the return.
Thus, for tax years 1989 through and including 1992, the
statute did not impose the reasonable basis requirement.
However, regulations promulgated under section 6662 to
implement the adequate disclosure exception, former section
1.6662-4(e) and (f), Income Tax Regs., provided as follows:
(e) Disclosure of certain information--
(1) Effect of adequate disclosure. Items for
which there is adequate disclosure as provided
in this paragraph (e) and in paragraph (f) of
this section are treated as if such items were
shown properly on the return for the taxable year
in computing the amount of the tax shown on the
return. Thus, for purposes of section 6662(d),
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