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underpayment of tax for purposes of the section 6653(a)(1)
and (2) additions to tax.
Respondent's determinations, contained in the notice of
deficiency, are presumed correct, and petitioners bear the burden
of proving otherwise. Rule 142(a); Welch v. Helvering, 290 U.S.
111, 115 (1933). Therefore, petitioners have the burden of
proving that they were not negligent in this case. See Schrum v.
Commissioner, 33 F.3d 426, 437 (4th Cir. 1994), affg. in part and
vacating in part T.C. Memo. 1993-124; Estate of Mason v.
Commissioner, 64 T.C. 651 (1975), affd. 566 F.2d 2 (6th Cir.
1977).
Section 6653(a)(1) imposes an addition to tax if any "part
of any underpayment" of tax is due to negligence or intentional
disregard of rules or regulations. Section 6653(a)(2) imposes an
addition to tax in an amount equal to 50 percent of the interest
due on the portion of the underpayment attributable to
negligence.
Definition of Negligence Under Section 6653(a)
Negligence is defined as the failure to exercise the due
care that a reasonable and ordinarily prudent person would employ
under the circumstances. Neely v. Commissioner, 85 T.C. 934, 947
(1985). Thus, to avoid imposition of the addition to tax,
petitioners must show that their actions in connection with the
deductions and credits from Mid Continent on their 1983 and 1984
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