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knowledgeable and experienced businessman. He is a certified
financial planner, runs his own businesses, and prepared
petitioners’ returns, which included detailed depreciation
schedules. Despite this, petitioners claimed deductions for
hundreds of thousands of dollars of business expenses, none of
which they could substantiate. Petitioners failed to convince
the Court they took the requisite effort to determine their
proper tax liability considering petitioner’s knowledge and
experience. We find that petitioners did not prove that the
underpayments of income tax for the years at issue were due to
reasonable cause and that they acted in good faith. Accordingly,
we conclude that petitioners are liable for the accuracy-related
penalty for each of the years at issue.
To reflect the foregoing and the concessions of the
parties,
Decision will be entered
under Rule 155.
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Last modified: May 25, 2011