Kyle L. and Carol B.Thornton - Page 8




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          respondent's agents.  Petitioners followed that advice, and the             
          notice of deficiency followed in due course.4                               
               As noted above, the deficiencies are no longer in dispute.             
          Petitioners contend they should be absolved of liability for the            
          section 6662 penalties because they relied on the representations           
          of their return preparer.                                                   
               Section 6662(a) provides for an accuracy-related penalty               
          equal to 20 percent of any portion of an underpayment of tax                
          required to be shown on the return that is attributable to the              
          taxpayer's negligence or disregard of rules or regulations.  Sec.           
          6662(a) and (b)(1).  Negligence consists of any failure to make a           
          reasonable attempt to comply with the provisions of the Internal            
          Revenue Code and disregard consists of any careless, reckless, or           
          intentional disregard.  Sec. 6662(c).  The courts have refined              
          the Code definition of negligence as a lack of due care or                  
          failure to do what a reasonable and prudent person would do under           
          similar circumstances.  Allen v. Commissioner, 925 F.2d 348, 353            
          (9th Cir. 1991), affg. 92 T.C. 1 (1989).  Section 1.6662-3(b)(1),           
          Income Tax Regs., provides that "Negligence is strongly indicated           
          where * * * a taxpayer fails to make a reasonable attempt to                
          ascertain the correctness of a deduction * * * on a return which            


               4    This case is one of numerous cases heard by the Court             
          involving tax returns prepared by Mr. Beltran, which essentially            
          involve the same deductions.  At some point in the audit process,           
          Mr. Beltran ceased all communications with his former clients.              




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