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validity of the tax benefits. See Zmuda v. Commissioner, 731
F.2d 1417, 1422-1423 (9th Cir. 1984), affg. 79 T.C. 714 (1982).
Petitioners did not obtain independent advice or look beyond
the trust promoters and an accountant (Dunning) to whom they were
referred by Becker, from whom they bought the trust package.
Their claim of good faith reliance on Dunning is not persuasive;
they should have sought confirmation from a reliable and
disinterested adviser. See Collins v. Commissioner, supra
(taxpayer failed to obtain independent tax advice); Edwards v.
Commissioner, T.C. Memo. 2002-169 (taxpayer could not rely on the
trust promoter), affd. 119 Fed. Appx. 293 (D.C. Cir. 2005);
Lincir v. Commissioner, T.C. Memo. 1999-98 (reliance on an
accountant’s advice about the tax treatment of an investment
program was not in good faith where the accountant could earn
more if his clients invested in the program), affd. 32 Fed. Appx.
278 (9th Cir. 2002).
Petitioners contend that the fact that Dunning was in
contact with WCS and attended a WCS meeting shows that it was
reasonable to rely on him. We disagree. Dunning’s relationship
with Becker and WCS should have put petitioners on notice that he
was not independent or disinterested.
Petitioners cite Kantor v. Commissioner, 998 F.2d 1514,
1522-1523 (9th Cir. 1993), affg. in part and revg. in part T.C.
Memo. 1990-380; Norgaard v. Commissioner, 939 F.2d 874, 880 (9th
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