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the APA, supra, upon the issuance of any taxpayer-unfriendly
rule, the APA, id., does not require such a Draconian result.
We sustain respondent's determination on this issue. In so
doing, we decline petitioners' invitation to allow them to apply
the rules of section 1.469-4T(b)(ii)(B), Temporary Income Tax
Regs., 54 Fed. Reg. 20543, in lieu of the rules stated in section
1.469-4(a), Income Tax Regs. Simply put, the effective date and
transition rules related to the regulatory rules under section
469 do not allow them to use it. See sec. 1.469-11, Income Tax
Regs.
As to the accuracy-related penalty, section 6662(a) imposes
an accuracy-related penalty equal to 20 percent of the portion of
an underpayment that is attributable to, among other things,
negligence. Petitioners will avoid this charge if the record
shows that they were not negligent; i.e., they made a reasonable
attempt to comply with the provisions of the Internal Revenue
Code, and they were not careless, reckless, or in intentional
disregard of rules or regulations. Sec. 6662(c); Accardo v.
Commissioner, 942 F.2d 444, 452 (7th Cir. 1991), affg. 94 T.C. 96
(1990); Drum v. Commissioner, T.C. Memo. 1994-433, affd. without
published opinion 61 F.3d 910 (9th Cir. 1995); see also Allen v.
Commissioner, 925 F.2d 348, 353 (9th Cir. 1991) (negligence
defined as a lack of due care or a failure to do what a
reasonable and prudent person would do under similar
circumstances), affg. 92 T.C. 1 (1989). Good faith reliance on
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