- 2 - effect for the year in issue, and all Rule references are to the Tax Court Rules of Practice and Procedure. The issues for decision are: (1) Whether petitioners are liable for additions to tax for negligence under section 6653(a); (2) whether petitioners are liable for the addition to tax for a substantial understatement under section 6661; (3) whether this Court has jurisdiction to review the section 6621(c) tax- motivated interest assessed by respondent and remaining unpaid by petitioners; and (4) if this Court does have jurisdiction to review the tax-motivated interest, whether such interest was properly assessed in this case.1 The issues in this case concern an investment in Yuma Mesa Jojoba, Ltd. (“Yuma Mesa” or “the partnership”).2 1In their petition, petitioners raised the additional issues of the possible applicability of sec. 6404(g), regarding suspension of interest and penalties, and the possible applicability of the statute of limitations under sec. 6229(f). Petitioners, however, did not include these issues in either their trial memorandum or their posttrial brief. We therefore consider them to have been abandoned. 2The underlying deficiency in this case is based upon a computational adjustment made by respondent in accordance with partnership level adjustments. Those adjustments were upheld by this Court in Cactus Wren Jojoba, Ltd. v. Commissioner, T.C. Memo. 1997-504. In that case, this Court reviewed respondent’s determinations with respect to Yuma Mesa and a related partnership. We held that the partnerships did not directly or indirectly engage in research or experimentation and that the partnerships lacked a realistic prospect of entering into a trade or business. In upholding respondent’s disallowance of $1,298,031 in research and experimental expenditures claimed by Yuma Mesa, we described the research and development agreement (continued...)Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011