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By adding subparagraph (B) to section 6664(c)(2), Congress
obviously intended that the taxpayer take some further steps
beyond merely obtaining an appraisal from a qualified appraiser.
We believe that petitioners’ actions in this case fall short of
what subparagraph (B) requires. Petitioner had experience in
real estate, given his activity in purchasing property at tax
sales and reselling it, and successfully ran his own engineering
and survey business. Thus he is chargeable with some
sophistication in real estate matters. Taking into account
petitioner’s experience, and the fact that he did not even visit
the property until approximately 1 month before trial, we
conclude that he failed to make a “good faith investigation” of
the value of the contributed property within the meaning of
section 6664(c)(2)(B) before claiming the value on the tax
return. See Sergeant v. Commissioner, T.C. Memo. 1998-265.
Therefore, petitioners have failed to satisfy section
6664(c)(2)(B), and the reasonable cause exception does not apply.
Accordingly, petitioners are liable for the accuracy-related
penalty under section 6662(h) for 1990 and 1992 as determined by
respondent.
An appropriate order will be
issued.
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