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amount of tax shown in such return, see sec. 6662(d)(2)(A), and
is substantial in the case of an individual if the amount of the
understatement for the taxable year exceeds the greater of 10
percent of the tax required to be shown in the tax return for
that year or $5,000, see sec. 6662(d)(1)(A).
The amount of the understatement is reduced to the extent
that it is attributable to, inter alia, an item for which there
is or was substantial authority. See sec. 6662(d)(2)(B)(i). In
order to satisfy the substantial authority standard of section
6662(d)(2)(B)(i), a taxpayer must show that the weight of the
authorities supporting the tax return treatment of an item is
substantial in relation to the weight of authorities supporting
contrary treatment. See Antonides v. Commissioner, 91 T.C. 686,
702 (1988), affd. 893 F.2d 656 (4th Cir. 1990); sec. 1.6662-
4(d)(3)(i), Income Tax Regs. The substantial authority standard
is not so stringent that a taxpayer’s treatment must be one that
is ultimately upheld in litigation or that has a greater than 50-
percent likelihood of being sustained in litigation. See sec.
1.6662-4(d)(2), Income Tax Regs. A taxpayer may have substantial
authority for a position even where it is supported only by a
well-reasoned construction of the pertinent statutory provision
as applied to the relevant facts. See sec. 1.6662-4(d)(3)(ii),
Income Tax Regs. There may be substantial authority for more
than one position with respect to the same item. See sec.
1.6662-4(d)(3)(i), Income Tax Regs.
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