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the terms of the policy and that these amounts were passed on to
OPL. If that is so, respondent can no doubt question the
deductibility of those payments in subsequent years. But there
appears to be no question that the premium payments to Liberty
Mutual in 1984 were required by the policy, the policy was valid,
and by the written terms of the policy risk was shifted. We
reject respondent's argument that premiums paid in 1984 were not
deductible by petitioner.
IV. Additions to Tax
Respondent determined that petitioner is liable for
additions to tax for negligence under section 6653(a)(1) and (2)
for 1984. Section 6653(a)(1) imposes a 5-percent addition to tax
if any part of any underpayment of tax required to be shown on a
return is due to negligence or intentional disregard of rules or
regulations. Section 6653(a)(2) provides for a separate addition
to tax equal to 50 percent of the interest payable on the portion
of the underpayment attributable to negligence or intentional
disregard of rules or regulations. Respondent's determination is
presumed correct, and petitioner bears the burden of proving
otherwise. See Rule 142(a); Bixby v. Commissioner, 58 T.C. 757,
791-792 (1972).
Negligence within the meaning of section 6653(a) has been
defined as the failure to do what a reasonable and ordinarily
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