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and, pursuant to their office policy, they entered the
amount of income tax withheld from Mrs. Harrison's salary
as petitioners' total tax liability for 1988.
In estimating petitioners' income for 1988,
petitioners' accountants took into account Mr. Harrison's
share of partnership income from the Houston firm.
Petitioner, Ms. Cates, and Ms. Ruble all attempted to
contact Mr. Greg Dewinney, the C.P.A. for the Houston firm,
prior to April 15, 1989, in order to obtain information
about Mr. Harrison's income from the firm for 1988, but
they were unsuccessful.
Petitioners' accountants knew that Mr. Harrison had
finally withdrawn from the firm in early April 1988
and that he had reported income from the firm for the
prior year of approximately $400,000. Accordingly, they
estimated that he would realize approximately $100,000
from the firm for the first 3 months of 1988 before his
withdrawal from the firm (i.e., $400,000 x 3/12ths).
Subsequently, petitioners received a Schedule K-1,
Partner's Share Of Income, Credits, Deductions, Etc., from
the Houston firm in a letter from the firm dated August 15,
1989. The Schedule K-1 reports that Mr. Harrison's income
from the firm for 1988 is $261,309. Petitioners and their
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