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opinion letter should itself insulate petitioners from the
negligence additions to tax.
Because Mr. Trimboli was not an independent adviser,
petitioners’ reliance on any advice from him was not reasonable.
Bello v. Commissioner, T.C. Memo. 2001-56 (reliance on advice
from an accountant concerning an investment was unreasonable
where the accountant had been retained by the investment
promoter); LaVerne v. Commissioner, supra; Rybak v. Commissioner,
supra.
Finally, petitioners cite Hummer v. Commissioner, T.C. Memo.
1988-528, for the proposition that taxpayers cannot be negligent
where the relevant legal issue was “not well settled”.
Petitioners, however, did not receive substantive advice
concerning the deduction from anyone independent of the
investment, nor did they conduct their own investigation into the
propriety of the deduction. Indeed, there is no indication that
petitioners ever were aware of the nature of the purportedly
uncertain legal issues involved. Petitioners may not rely upon a
“lack of warning” as a defense to negligence where no reasonable
investigation was ever made which would have allowed them to
discover such a lack of warning, and where they were repeatedly
warned of the relevant risks in the private placement memorandum.
Christensen v. Commissioner, T.C. Memo. 2001-185; Robnett v.
Commissioner, T.C. Memo. 2001-17.
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