Nicholas P. Ruggiero and Annette M. Ruggiero - Page 12




                                       - 12 -                                         
          Petitioners demonstrate little, if any, idea of how their                   
          investment was supposed to work.  They knew nothing about jojoba            
          research.                                                                   
               They did know that their maximum amount at risk was the                
          $5,500 they paid in cash, and yet they had the potential to                 
          deduct more than twice that amount as a loss on their Federal               
          income tax return for 1983.  They relied, in making their                   
          investment, entirely on whatever they were told by Desmond.  They           
          did not share that information with the Court.  They relied on              
          Desmond even though this was their first contact with him and               
          they assumed he would receive a commission from, and thus had an            
          monetary interest in, making the sale.                                      
               The Court finds that petitioners failed to reasonably                  
          attempt to comply with the tax code and regulations.  Their                 
          actions evidence a lack of due care or the failure to do what a             
          reasonable or ordinarily prudent person would do under the                  
          circumstances.  Chamberlain v. Commissioner, supra.                         
               Petitioners are liable for the additions to tax under                  
          section 6653(a)(1) and (2) for the year 1983.                               
               To reflect the foregoing,                                              
                                                  Decision will be entered            
                                             for respondent.                          










Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  

Last modified: May 25, 2011