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professionals to verify the accuracy of the returns prepared by
Mr. Beltran or the representations he made to them regarding
their deductions. The Court is satisfied from the record that
Mr. Beltran knew, or had reason to know, all the relevant facts
upon which, had he been a qualified professional, he could have
accurately advised petitioners on the amount of their allowable
deductions. Mr. Beltran claimed unrealistic and false amounts as
deductions on petitioners' returns. The Court is satisfied that
petitioners knew they were required under the law to substantiate
deductions claimed on their returns, as they had done in prior
years. The questions they posed to Mr. Beltran and the answers
he gave them should have prompted them to look beyond and
ascertain the accuracy of his representations. Petitioners,
therefore, made no effort to assess their tax liability
correctly. On this record, the Court sustains respondent on the
section 6662(a) accuracy-related penalties for the years in
question.
Section 6673(a) authorizes the Court to require a taxpayer
to pay to the United States a penalty not exceeding $25,000 when,
in the Court's judgment, proceedings have been instituted or
maintained by the taxpayer primarily for delay or where the
taxpayer's position in the proceeding is frivolous or groundless.
The Court considers petitioners' claim that they should not be
liable for the deficiencies and penalties to be frivolous and
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Last modified: May 25, 2011