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record. From their presentation at trial, the Court can
understand how they, or petitioner, might have been misled by
statements made by the promoters of the TRS program and
statements contained in the Renaissance materials. However, we
cannot excuse petitioners’ failure to substantiate many, if not
most of the deductions claimed on the Schedule C. See sec.
1.6662-3(b)(1), Income Tax Regs. Respondent’s imposition of the
section 6662(a) penalty is appropriate in this case, and we so
find.
Reviewed and adopted as the report of the Small Tax Case
Division.
To reflect the foregoing and concessions by respondent,
Decision will be entered
under Rule 155.
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Last modified: May 25, 2011