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reckless, or intentional disregard. Id. An underpayment is not
attributable to negligence or disregard to the extent that the
taxpayer shows that the underpayment is due to the taxpayer’s
reasonable cause and good faith. Secs. 1.6662-3(a), 1.6664-4(a),
Income Tax Regs. Reasonable cause requires that the taxpayer
have exercised ordinary business care and prudence as to the
disputed item. See United States v. Boyle, supra. Petitioners
have presented no persuasive evidence on this issue, and the
record does not otherwise establish that their failure to report
their income accurately was due to reasonable cause or good
faith. We sustain respondent’s determinations under section
6662(a).
In conclusion, we note that section 6673(a)(1) authorizes
this Court to require a taxpayer to pay to the United States a
penalty not in excess of $25,000 whenever it appears that
proceedings have been instituted or maintained by the taxpayer
primarily for delay or that the taxpayer’s position in the
proceeding is frivolous or groundless. Although the
circumstances of this case suggest that petitioners may have
instituted this proceeding primarily for delay, with a position
that is frivolous or groundless, we shall not now impose a
penalty under section 6673(a)(1). We take this opportunity,
however, to admonish petitioners that we shall strongly consider
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