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of the units. The offering memorandum also identified Gordon as
“Special Counsel to the General Partner” and stated that
Dickinson could pay professional fees to Gordon in an amount
equal to 5 percent of the aggregate price of the units.
At trial, petitioner admitted that he did not pay Gordon for
investment advice, and he described Gordon as “an attorney who
put together investment deals of this sort”. Under these
circumstances, we are unable to accept uncritically petitioner’s
assertion that he did not realize that Gordon was being
compensated by Dickinson. At the very least, petitioner should
have known that Gordon had a conflict of interest. See Addington
v. Commissioner, 205 F.3d at 59.
Petitioner also contends that he reasonably relied on the
advice of Kabeck, his accountant and return preparer. For
reliance on professional advice to excuse a taxpayer from
negligence, the taxpayer must show that the professional had the
requisite expertise, as well as the knowledge of the pertinent
facts, to provide informed advice on the particular subject
matter. See David v. Commissioner, 43 F.3d 788, 789-790 (2d Cir.
1995), affg. per curiam T.C. Memo. 1993-621; Goldman v.
Commissioner, supra; Freytag v. Commissioner, supra. A taxpayer
may not reasonably rely on the advice of an accountant who knows
nothing about the nontax business aspects of the contemplated
venture. See Freytag v. Commissioner, supra; Beck v.
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