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(5th Cir. 1967), affg. in part and remanding in part on another
ground 43 T.C. 168 (1964)); see Allen v. Commissioner, 925 F.2d
348, 353 (9th Cir. 1991), affg. 92 T.C. 1 (1989). Negligence is
determined by testing a taxpayer’s conduct against that of a
reasonable, prudent person. Zmuda v. Commissioner, 731 F.2d
1417, 1422 (9th Cir. 1984), affg. 79 T.C. 714 (1982). Courts
generally look both to the underlying investment and to the
taxpayer’s position taken on the return in evaluating whether a
taxpayer was negligent. Sacks v. Commissioner, 82 F.3d 918, 920
(9th Cir. 1996), affg. T.C. Memo. 1994-217.
The Commissioner’s decision to impose the negligence
addition to tax or penalty is presumptively correct. Collins v.
Commissioner, 857 F.2d 1383, 1386 (9th Cir. 1988), affg. Dister
v. Commissioner, T.C. Memo. 1987-217; Hansen v. Commissioner, 820
F.2d 1464, 1469 (9th Cir. 1987). A taxpayer has the burden of
proving that Commissioner’s determination is erroneous and that
he did what a reasonably prudent person would have done under the
circumstances. See Rule 142(a); Hansen v. Commissioner, supra;
Hall v. Commissioner, 729 F.2d 632, 635 (9th Cir. 1984), affg.
T.C. Memo. 1982-337; Bixby v. Commissioner, 58 T.C. 757, 791
(1972).
Good faith reliance on professional advice concerning tax
laws may be a defense to the negligence additions to tax. United
States v. Boyle, 469 U.S. 241, 250-251 (1985). However,
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