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is "substantial" when the understatement for the taxable year
exceeds the greater of (1) 10 percent of the tax required to be
shown on the return or (2) $5,000. The understatement is reduced
to the extent that the taxpayer (1) has adequately disclosed his
or her position, or (2) has substantial authority for the tax
treatment of an item. See sec. 6661; sec. 1.6661-6(a), Income
Tax Regs. Petitioners again bear the burden of showing that they
are not subject to the addition to tax determined by respondent.
See Rule 142(a); Cochrane v. Commissioner, 107 T.C. 18, 29
(1996).
Petitioners presented no evidence to show that respondent
erroneously determined the addition to tax under section 6661.
Accordingly, we hold that petitioners are liable for the addition
to tax under section 6661. Their concessions with respect to the
deficiencies at issue show that their understatement for 1982
exceeds the greater of $5,000 or 10 percent of the tax required
to be shown on their return for 1982. Respondent determined that
all of petitioners' 1982 underpayment is attributable to that
substantial understatement. Because petitioners have not
disputed this determination, we so hold.
In view of the foregoing,
Decision will be entered
under Rule 155.
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Last modified: May 25, 2011