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allowance after he stopped traveling, including the amount
thereof in the checks that it would give him every month for his
services and for his reimbursed expenses.
The accounting firm never advised Shane Medical or the
Shanes on the difference or distinction between a personal and a
business expense.
OPINION
Respondent determined that the underpayments stemming from
the income adjustments mentioned above were due to negligence,
and, accordingly, that all of petitioners were liable for
accuracy-related penalties under section 6662(a). Section
6662(a) imposes an accuracy-related penalty equal to 20 percent
of the portion of an underpayment that is attributable to
negligence.
Petitioners must prove this determination wrong. See Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933); see also
Allen v. Commissioner, 925 F.2d 348, 353 (9th Cir. 1991), affg.
92 T.C. 1 (1989); Bixby v. Commissioner, 58 T.C. 757, 791-792
(1972). Petitioners must prove that they made a reasonable
attempt to comply with the provisions of the Internal Revenue
Code, and that they were not careless, reckless, or in
intentional disregard of rules or regulations. See sec. 6662(c).
We believe that both Shane Medical and the Shanes have
disproved respondent's determination of negligence. A taxpayer
is not negligent when the taxpayer relies reasonably on a tax
adviser for tax advice. Reasonable reliance occurs when:
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