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be “major” from the point of view of accepting Mr. Cohen’s
representations of the tax consequences which flowed from the SC
VEBA.
We also are not persuaded by petitioners’ assertion that the
accuracy-related penalties are inapplicable because, they claim,
the issues at bar are matters of first impression. It is not new
in the arena of tax law that individual shareholders have tried
surreptitiously to withdraw money from their closely held
corporations to avoid paying taxes on those withdrawals. The
fact that the physicians at bar have attempted to do so in the
setting of a speciously designed life insurance product does not
negate the fact that the underlying tax principles involved in
this case are well settled. Nor does the application of the
negligence accuracy-related penalty turn on the fact that this
case is a “test case” as to the tax consequences flowing from a
taxpayer’s participation in the subject VEBA’s. When the
requirements for the negligence accuracy-related penalty are met,
a taxpayer in a test case is just as negligent as the taxpayers
who have agreed to be bound by the resolution of the test case.
We conclude that each of petitioners is liable for the
accuracy-related penalties determined by respondent.
8. Addition to Tax for Failure To File Timely
Lakewood filed its 1992 tax return with the Commissioner on
May 28, 1993. The unextended due date of the return was March
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