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1995. We believe that petitioners enjoyed the ranch lifestyle,
were wealthy enough to indulge that lifestyle without too much
concern for costs (remember, they did not always open their bank
statements), and, at least during their years on the Arkansas
ranch, viewed the Schedule F activity as an integral part of that
lifestyle (without regard to profitability).
9. Success in Similar Activities
Petitioner did not demonstrate success in carrying on any
similar activity. See sec. 1.183-(2)(b)(6), Income Tax Regs.
E. Conclusion
During the years in issue, the Schedule F activity was not
an activity engaged in for profit. Respondent’s determination of
a deficiency based on that determination is sustained.
II. Section 6662(a) Accuracy-Related Penalties
Section 6662 provides for an accuracy-related penalty in the
amount of 20 percent of the portion of any underpayment
attributable to, among other things, negligence or intentional
disregard of rules or regulations (hereafter, simply,
negligence). Respondent determined section 6662 penalties
against petitioners for their negligence in deducting the farm
losses shown on the 1992 and 1993 Schedules F. Negligence has
been defined as the failure to exercise the due care of a
reasonable and ordinarily prudent person under like
circumstances. See Neely v. Commissioner, 85 T.C. 934, 947
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