Robert L. Boehm and Winona J. Mowrey - Page 13




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               On brief, the individual petitioners argue that they should            
          not be liable for the negligence penalty because “the                       
          Commissioner at least impliedly approved a similar deduction on             
          their 1990 individual income tax return.”  The record does not              
          establish that respondent either implicitly or expressly approved           
          a similar deduction in 1990.  The only pertinent evidence apart             
          from Mowrey’s vague and self-serving testimony5 is respondent’s             
          no-change letter from 1990 and a revenue agent’s report which               
          indicates that the only items questioned in the 1990 audit were a           
          charitable contribution deduction and a deduction for investment            
          expenses.  There is no evidence that the revenue agent was even             
          aware of, much less approved, petitioners’ diversion of income to           
          Crestmark.                                                                  
               In support of their position, the individual petitioners               
          cite Matthews v. Commissioner, 92 T.C. 351 (1989), affd. 907 F.2d           


               5 On direct examination, Mowrey testified as follows:                  
                    Q.   Did you pay Crestmark that year, 1990, for the               
                         same type of services that you later paid them in            
                         1993?                                                        
                    A.   Yes, sir.                                                    
                    Q.   In the audit, do you know what the outcome of the            
                         audit was?                                                   
                    A.   Well, I don’t know all these fancy words that he             
                         was talking about, but the bottom line is, to me,            
                         was the IRS said, you know, This is not a problem;           
                         this is fine, you know.                                      




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