- 22 -
Sec. 6662(c); see also Allen v. Commissioner, 925 F.2d 348, 353
(9th Cir. 1991), affg. 92 T.C. 1 (1989) (negligence defined as a
lack of due care or a failure to do what a reasonable and prudent
person would do under similar circumstances). As to both
accuracy-related penalties, no penalty is imposed with respect to
any portion of an understatement as to which the taxpayer acted
with reasonable cause and in good faith. Sec. 6664(c)(1).
Petitioners must prove that respondent erred in determining that
the accuracy-related penalty applied to the years in issue.
Rule 142(a); Monahan v. Commissioner, 109 T.C. 235 (1997);
Bixby v. Commissioner, 58 T.C. 757, 791-792 (1972).
We primarily address respondent's determination of the
accuracy-related penalty for negligence because our decision on
that issue is dispositive. Because petitioners presented no
evidence or argument to support a finding that they exercised due
care and did what a reasonable and ordinarily prudent person
would have done under the circumstances, we find that they are
liable for negligence under section 6662(a). We also note that
petitioners presented no evidence or argument to support a
finding that they relied on substantial authority, adequately
disclosed relevant facts, or acted with reasonable cause and in
good faith. Therefore, to the extent that petitioners had not
been liable for the accuracy-related penalty for negligence, they
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