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the result in the Utah Jojoba I Research case at docket No. 7619-
90. The Court issued an opinion in Utah Jojoba I Research v.
Commissioner, T.C. Memo. 1998-6, on January 5, 1998, holding that
the partnership was not entitled to research and experimental
expense deductions. The Court found that the partnership was not
directly or indirectly engaged in research or experimentation,
was not engaged in a trade or business, and lacked a realistic
prospect of entering a trade or business. On June 4, 1999, the
Court entered a decision in the Arid Land case that upheld
respondent's diallowance of the partnership losses reported by
Arid Land in 1983 and 1984.
On July 3, 2000, respondent sent to petitioners the
statutory notice in this case containing respondent's
determination of their liability for the negligence additions to
tax.
As a result of the decision upholding the adjustments to the
1983 partnership return of Arid Land, petitioners were assessed
on July 24, 2000, additional tax of $3,345. Petitioners paid the
assessment on August 2, 2000.
OPINION
Petitioners argue that they are not subject to the additions
to tax for negligence because: (1) The statute of limitations
prohibits assessment of the additions to tax; and (2) they
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