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where and to the extent that understatements of tax are
attributable to negligence. Respondent asserts that this penalty
applies to the adjustments for depreciation recapture and
depreciation. Taxpayers are required to maintain adequate records
and failure to do so may constitute negligence and a disregard of
rules or regulations. See sec. 6001; see also Nehus v.
Commissioner, T.C. Memo. 1994-631, affd. without published opinion
108 F.3d 338 (9th Cir. 1997); Schroeder v. Commissioner, 40 T.C.
30, 34 (1963); Bard v. Commissioner, T.C. Memo. 1990-431.
Taxpayers bear the burden of proof with regard to this issue. See
Rule 142(a).
For 1991, the failure of petitioner to maintain adequate
records constitutes negligence. We sustain respondent's
determination of the accuracy-related penalty with respect to the
adjustments for depreciation recapture and depreciation.
For the years in issue, section 6651(a)(1) provides for an
addition to tax for failure to timely file Federal income tax
returns. The addition to tax equals 5 percent of the amount
required to be shown as tax on the return for every month the
return has not been filed, but not exceeding 25 percent. This
addition to tax will not be imposed if it is established that the
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