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argue that the Blythe II deduction was clearly indicated on their
1982 return. However, a mere claiming of the loss, without
further explanation, is not sufficient to alert respondent to the
controversial section 174 deduction of which the partnership loss
consisted. Petitioners have failed to show that the relevant
facts pertaining to their Blythe II loss deduction were
adequately disclosed on their 1982 return.10
Finally, section 6661(c) provides the Secretary with the
discretion to waive the section 6661(a) addition to tax if the
taxpayer shows he acted with reasonable cause and in good faith.
This Court reviews for abuse of discretion the Secretary’s
failure to waive the addition to tax. See Martin Ice Cream Co.
v. Commissioner, 110 T.C. 189, 235 (1998). Petitioners argue
that they acted in good faith and reasonably relied upon the
advice of Mr. Mathis in claiming the relevant loss. However,
nothing in the record indicates that petitioners requested a
waiver for good faith and reasonable cause under section 6661(c).
In the absence of such a request, this Court cannot review
respondent’s determination for an abuse of discretion. See id.
In any event, petitioners have not shown that they met the tests
of reasonable cause and good faith.
10 As noted earlier, even if an adequate disclosure had
been made on the return, such disclosure would not reduce the
amount of the understatement attributable to a tax shelter item.
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