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that his deductions were claimed in good faith and pursuant to
his reasonable reliance upon his professional tax adviser, Mr.
DiMaggio, and his lawyers.
Although petitioner places the blame for erroneous reporting
positions on both his accountant and his attorney, petitioner
directs most of the blame to his accountant, Mr. DiMaggio.
Petitioner claims, among other things, that it was Mr. DiMaggio
who decided to treat LFI and BAC as businesses under section 162,
who decided that LFI and BAC met the material participation
requirements of section 469, and who decided to treat BAC as an S
corporation for Federal tax purposes. Petitioner also claims
that he reasonably relied upon his accountant for all decisions
regarding the proper tax treatment of LFI and BAC.
Mr. DiMaggio testified extensively at the trial in this
case. Although Mr. DiMaggio admitted that he consulted with
petitioner concerning LFI and BAC, at no point during his
testimony did Mr. DiMaggio admit that he was responsible for the
reporting positions taken on petitioner’s returns with respect to
LFI and BAC. Mr. DiMaggio’s testimony only reinforces the
impression left by the record as a whole that he did not have
accurate information regarding the use of Granot Loma and the
aircraft and that petitioner intended from the time he purchased
Granot Loma and the aircraft to claim they were business assets
used in a business activity. For example, although Mr. DiMaggio
never visited Granot Loma during the years at issue, Mr. DiMaggio
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