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conclusion. Rather, there is ample evidence on the record in the
present case to establish independently that the series of
Plastics Recycling transactions, of which petitioners’ Clearwater
transaction was a part, constituted an economic sham. However,
because petitioners have provided no further evidence nor any
novel contention with respect to the underlying deficiency not
previously considered in Provizer, we shall not revisit that
opinion. Accordingly, we sustain respondent’s determination for
substantially identical reasons as in Provizer.
Issue 2. 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
Clearwater. Petitioners have the burden of proof to show that
they were not negligent. See Addington v. Commissioner, 205 F.3d
54 (2d Cir. 2000), affg. Sann v. Commissioner, T.C. Memo. 1997-
259; 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).
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
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