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Respondent determined that petitioners are liable for an
addition to tax for negligence under section 6653(a)(2) for 1982.
The only issue for decision is whether petitioners are liable for
the addition to tax for negligence pursuant to section 6653(a)(2)
for 1982 in the amount of 50 percent of the interest due on the
underlying deficiency of $6,479,2 which respondent computed in
connection with the disallowance of research and development
expenditures deducted in 1982 by Jojoba Research Partners,
Hawaii, a limited partnership.
Background
Some of the facts have been stipulated and are so found. We
incorporate the stipulation of facts by this reference.
Petitioners resided in Honolulu, Hawaii, on the date the petition
was filed. Hereinafter, references to petitioner are to Rodney
M. Fujiyama.
Petitioner graduated from law school and has been licensed
to practice law since 1970. Petitioner’s legal practice focuses
primarily on business transaction planning. Petitioner does not
practice tax law and has very little tax experience. When one of
petitioner’s clients requires tax advice, petitioner engages the
services of a national or local accounting firm to assist him.
2In his notice of deficiency, respondent determined that
petitioners are liable for a negligence penalty in the amount of
50 percent of the interest due on $13,367. Respondent conceded
in his trial memorandum that the penalty should be limited to 50
percent of the interest due on $6,479.
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