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bases of more than 400 percent of the amount determined to be the
correct adjusted bases. Keller v. Commissioner, T.C. Memo. 2006-
131; Jaroff v. Commissioner, T.C. Memo. 2004-276; see Zirker v.
Commissioner, 87 T.C. 970 (1986); see also McDonough v.
Commissioner, supra. In that petitioners’ resulting underpayment
of tax for 1992 exceeded $5,000, we conclude that their
underpayment of 1992 tax resulting from the disallowance of their
reported cost bases and depreciation deduction was attributable
to a gross valuation misstatement of over $5,000. Massengill v.
Commissioner, 876 F.2d 616 (8th Cir. 1989), affg. T.C. Memo.
1988-427; Zirker v. Commissioner, supra; Jaroff v. Commissioner,
supra; see also McDonough v. Commissioner, supra. We thus also
conclude that petitioners are liable for the 40-percent accuracy-
related penalty under section 6662(h) for 1992, unless they meet
the section 6664(c) exception for reasonable cause and good
faith.
Petitioners’ posttrial briefs argue that (among other cases)
Gainer v. Commissioner, 893 F.2d 225 (9th Cir. 1990), affg. T.C.
Memo. 1988-416, and Todd v. Commissioner, 862 F.2d 540 (5th Cir.
1988), affg. 89 T.C. 912 (1987), establish that the accuracy-
related penalty under section 6662(h) cannot apply if an asset
such as the cattle at issue fail to exist. We disagree with
petitioner’s argument. The deductions in the two cited cases
relied upon by petitioners were disallowed because the relevant
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