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Kaliban v. Commissioner, T.C. Memo. 1997-271; Sann v.
Commissioner, T.C. Memo. 1997-259 n.13 (and cases cited therein),
affd. Addington v. Commissioner, 205 F.3d 54 (2d Cir. 2000). We
found the taxpayers liable for the additions to tax for
negligence in nearly all of those cases.
I. Section 6653(a)(1) and (2) Negligence
Respondent determined that petitioners are liable for
additions to tax under section 6653(a)(1) and (2) with respect to
the underpayment attributable to petitioners’ investment in
Whitman. Petitioners have the burden of proof to show that they
are not liable for the additions to tax. See Addington v.
Commissioner, supra; Goldman v. Commissioner, 39 F.3d 402, 407
(2d Cir. 1994), affg. T.C. Memo. 1993-480; Luman v. Commissioner,
79 T.C. 846, 860-861 (1982); Bixby v. Commissioner, 58 T.C. 757,
791-792 (1972). See generally Rule 142(a); INDOPCO, Inc. v.
Commissioner, 503 U.S. 79, 84 (1992); Welch v. Helvering, 290
U.S. 111, 115 (1933).16
Section 6653(a)(1) and (2) imposes additions to tax if any
part of the underpayment of tax is due to negligence or
intentional disregard of rules or regulations. Negligence is
defined as the failure to exercise the due care that a reasonable
16 Cf. sec. 7491(c), effective for court proceedings
arising in connection with examinations commencing after July 22,
1998. In the present cases, the examination of petitioners’
income tax returns for 1982 and 1983 commenced well before July
22, 1998.
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