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Additions to Tax
Sec.1 Sec. Sec.
Year 6653(a)(1) 6653(a)(2) 36661
1983 $618 2$12,355 $3,089
1 Throughout this opinion and unless otherwise
indicated, all section references are to the Internal
Revenue Code in effect for the taxable year in issue.
2 The first page of the notice of deficiency
mistakenly equates the amount of this addition to tax with
the amount of the deficiency in income tax (see infra,
subdivision “I” of the Findings of Fact). Prior to trial,
respondent amended his answer to claim an increased
addition to tax pursuant to sec. 6214(a). The increase,
in the amount of $17,877, is purely computational in
nature.
3 The first page of the notice of deficiency
mistakenly references sec. 6662(d), which section is the
successor to sec. 6661 and is applicable for returns the
due date for which (determined without regard to
extensions) is after December 31, 1989. See Omnibus
Budget Reconciliation Act of 1989, Pub. L. 101-239, sec.
7721(a), (c)(2), (d), 103 Stat. 2395-2400.
After a concession by petitioners,1 the issues for decision
are as follows:
(1) Whether petitioners are liable for additions to tax
under section 6653(a)(1) and (2) for negligence or intentional
disregard of rules or regulations. We hold that petitioners are
liable for such additions.
(2) Whether petitioners are liable for the addition to tax
under section 6661 for substantial understatement of tax
liability. We hold that petitioners are liable for such
1 Petitioners concede that the notice of deficiency is
valid. Cf. Scar v. Commissioner, 814 F.2d 1363 (9th Cir. 1987),
revg. 81 T.C. 855 (1983).
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