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Internal Revenue Code and defines “disregard” as any careless,
reckless, or intentional disregard.
Petitioners have conceded that many of the claimed business
expenses disallowed by respondent in the notices of deficiency
were personal expenses of the Wrights, not deductible by HJ
Builders, and represent additional income to the Wrights. The
evidence includes failure to maintain adequate records or to
substantiate deductions, mislabeling of expenses, and the errors
now conceded by petitioners. Petitioners have not addressed, at
trial or on brief, the accuracy-related penalties determined by
respondent pursuant to section 6662. Thus we deem petitioners to
have conceded their liability for the penalties. See, e.g.,
Levin v. Commissioner, 87 T.C. 698, 722-723 (1986), affd. 832
F.2d 403 (7th Cir. 1987); Hendricks v. Commissioner, T.C. Memo.
2001-299.
Therefore, petitioners are liable for the accuracy-related
penalties determined under section 6662.
To reflect the foregoing,
Decisions will be entered
under Rule 155.
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