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profits through dividends and the increase in value of his
investment than to that of a promoter who buys and sells
companies as if they were inventory. We conclude that petitioner
was not in the trade or business of promoting business ventures
in the health care industry. Thus, petitioners may not deduct as
a business bad debt the $450,000 loss.
We have considered all other arguments of petitioners, and
they are addressed by the consideration of lack of remaining
carryover losses belonging to the bankruptcy estate or otherwise
lack merit.
Additions to Tax and Penalties
Respondent determined additions to tax for failure to file
tax returns under section 6651(a)(1) and additions to tax for
failure to make timely payment of taxes under section 6651(a)(2).
Respondent also determined additions to tax for negligence under
section 6653(a)(1), additions to tax for negligence under section
6653(a)(1)(A) and (B), and accuracy-related penalties for
negligence or substantial understatements under section 6662(a).
Additions to Tax for Failure To File Timely
a Tax Return and Pay Tax Liability
Section 6651(a)(1) provides for an addition to tax of
5 percent of the tax required to be shown on the return for each
month or fraction thereof for which there is a failure to file,
not to exceed 25 percent. Section 6651(a)(2) provides for an
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