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Indicated Value $1,083,568
Rounded $1,100,000
C. Value Conclusion
Based upon an analysis of all the valuation evidence
introduced through both testimony and documentation, and giving
due consideration to the credibility of the witnesses at trial,
we hold that the fair market value of the Redwood City Fox as of
December 31, 1986, the date of its donation to the Players, was
$3,100,000.51
III. Addition to Tax and Penalties
The final issue is whether Jacobs is liable for an addition
to tax for negligence or disregard of rules or regulations under
section 6653(a)(1) for taxable year 1988; and whether Jacobs is
liable for accuracy-related penalties under section 6662 for
negligence or disregard of rules or regulations, any substantial
understatement of income tax, and/or any substantial valuation
overstatement for taxable years 1989 and 1990.
A. Addition to Tax for Negligence
For 1988, section 6653(a)(1) imposes an addition to tax
equal to 5 percent of the underpayment if any part of the
underpayment is attributable to negligence or disregard of rules
or regulations. "Negligence" means any failure to make a
reasonable attempt to comply with the Internal Revenue Code, and
51 Respondent introduced evidence of the Redwood City Fox's
assessed value for purposes of California real property taxes.
We considered the property's 1986 assessed value for real estate
tax purposes, but we find that value not to represent the Redwood
City Fox's fair market value.
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