Don L. and Lora Christensen - Page 2




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                         Additions to Tax                                             
               Year      Sec. 6653(a)(1)     Sec. 6653(a)(2)     Sec. 6661            
               1982           $1,047              *              $5,234               
               1983           50                  **             –--                  
               *    Fifty percent of the interest due on $20,933.                     
               **   Fifty percent of the interest due on $1,006.                      

               The issues for decision are: (1) Whether, for 1982 and 1983,           
          petitioners are liable for the additions to tax under section               
          6653(a)(1) and (2) for negligence, and (2) whether, for 1982,               
          petitioners are liable for the addition to tax under section 6661           
          for a substantial understatement of tax.  The issues in this case           
          relate to the participation of Don L. Christensen (petitioner) as           
          a limited partner in a partnership known as Blythe Jojoba II                
          Research, Ltd. (Blythe II or the partnership).                              
               Some of the facts were stipulated, and those facts, with the           
          annexed exhibits, are so found and are incorporated herein by               
          reference.  At the time the petition was filed, petitioners'                
          legal residence was Las Vegas, Nevada.                                      
               Petitioner is a medical doctor specializing in general                 
          surgery.  Petitioner has been practicing general surgery in Las             
          Vegas, Nevada, since 1965.  When petitioner's investment adviser            
          retired, he referred petitioner to another financial adviser                
          named Gary Sheets (Mr. Sheets).  At that time, Mr. Sheets began             
          advising petitioner on various financial matters and introduced             
          petitioner to numerous investment opportunities.                            





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