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and ordinarily prudent person would exercise under the
circumstances. See Neely v. Commissioner, 85 T.C. 934, 947
(1985). The pertinent question is whether a particular
taxpayer's actions are reasonable in light of the taxpayer's
experience, the nature of the investment, and the taxpayer's
actions in connection with the transactions. See Henry Schwartz
Corp. v. Commissioner, 60 T.C. 728, 740 (1973). In this regard,
the determination of negligence is highly factual. "When
considering the negligence addition, we evaluate the particular
facts of each case, judging the relative sophistication of the
taxpayers as well as the manner in which the taxpayers approached
their investment." Turner v. Commissioner, T.C. Memo. 1995-363.
Petitioners have the burden of proving error in respondent's
determination of the additions to tax for negligence. See Rule
142(a); Luman v. Commissioner, 79 T.C. 846, 860-861 (1982); Bixby
v. Commissioner, 58 T.C. 757, 791-792 (1972).
A. Petitioner's Experience
We start with the contention that petitioner was not
negligent because, on the basis of his summer employment at
Consolidated and his representation of SPI and BP after
graduating from law school, he reasonably expected to make a
profit from the Clearwater investment. In this regard,
petitioner claims that from personal experience, he appreciated
the economic desirability of effective recycling equipment and
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