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Mr. Juarez testified that he had signed the purchase orders
that were offered into evidence by petitioner during 1993.
Further, he testified that the purchase order forms were blank
when he had signed them. Petitioner admitted that the forms were
signed by Mr. Juarez during 1993. In addition, respondent
produced evidence supporting Mr. Juarez’ testimony that his
business activity with petitioner (other than in the relationship
of employer-employee) began during 1993.
Petitioner also produced a Form 1099-MISC in Mr. Juarez’
name reflecting nonemployee compensation for 1992. Respondent,
to counter petitioner’s production of this evidence, provided
credible evidence that no such Form 1099-MISC was received by the
Internal Revenue Service for the 1992 tax year. It also appears
that the last two digits had been altered from some other year to
1992 on the Form 1099-MISC that was offered by petitioner.
We hold that petitioner’s position is without merit and that
her evidence and testimony are not believable.
Respondent determined an accuracy-related penalty due to
negligence under section 6662(a) for petitioner’s 1992 taxable
year. The accuracy-related penalty is equal to 20 percent of any
portion of an underpayment attributable to a taxpayer’s
negligence or disregard of rules or regulations. Sec. 6662(a)
and (b)(1). The term “negligence” includes any failure to do
what a reasonable and ordinarily prudent person would do under
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