- 2 -2
Additions to Tax
Year Sec. 6653(a)(1) Sec. 6653(a)(2) Sec. 6659
1981 $587 * $3,523
1984 642 ** 3,854
* An amount equal to 50 percent of the interest due on $11,744.
** An amount equal to 50 percent of the interest due on $12,846.
After concessions, the issues remaining for decision are:
(1) Whether petitioners are liable for additions to tax for
negligence under section 6653(a)(1) and (2); and (2) whether
petitioners are liable for additions to tax for valuation
overstatement under section 6659.
This is an affected items proceeding which arises out of
petitioners' participation in the Alamo East Enterprises and
Alamo East Enterprises 1984 partnerships (the Alamo
partnerships), which leased master recordings. The parties
stipulated that the Alamo partnerships were involved in the
Encore Leasing Tax Shelter (Encore Leasing). See Miller v.
Commissioner, 104 T.C. 378 (1995). Some of the other facts in
the instant case also have been stipulated and are so found. For
clarity and convenience, the findings of fact and opinion have
been combined.
Petitioners resided in Danville, California, at the time the
petition was filed. During 1984, petitioner Robert P. Neumann
(petitioner) was the president of Thompson Electric, an
electrical contracting firm located in San Ramon, California.
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