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conclude that petitioners are liable for the accuracy-related
penalty under section 6662(a) for 1999-2001 except with respect
to petitioner to the extent he is liable for fraud for 2000.8
G. Whether Respondent Should Be Sanctioned
Petitioners assert that respondent engaged in, and should be
sanctioned for, the following conduct: (1) Hughs refused to
answer 28 written questions from petitioners; (2) Hughs expanded
the audit without authority; (3) Hughs said petitioners are tax
protesters; (4) respondent refused petitioners’ request for a
different auditor; (5) petitioners did not receive a copy of the
answer until respondent filed a motion for entry of order that
undenied allegations in answer be deemed admitted; (6) respondent
initiated formal discovery before informal discovery was
complete; (7) respondent’s counsel had records from petitioners’
bank which he denied that he had; and (8) respondent’s counsel at
trial altered a document created by petitioners. We disagree.
Petitioners have not shown or argued convincingly that respondent
should be sanctioned.
To reflect concessions and the foregoing,
Decision will be
entered under Rule 155.
8 Respondent concedes that the accuracy-related penalty
under sec. 6662 does not apply to disallowed deductions for which
respondent determined fraud against petitioner.
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