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Petitioners do not dispute the errors on their tax returns
with respect to the noncash charitable contributions. They
acknowledge that the appraisals of the donated property were not
“qualified appraisals” as required by the regulations; that none
of the appraisals was made within 60 days of the contribution of
the partnership interest; that Mr. Kramer (C.P.A.) and Rick
Brewster (Mr. Brewster) (C.P.A.) each decided not to value the
partnership interests (i.e., the property donated), but decided
to value the only asset of the partnerships (the Beneco stock).
Petitioners contend that these errors or omissions do not, ipso
facto, make them liable for penalties and that the issue is
simply whether they reasonably relied on the professionals they
hired–-Attorney Kelley, experienced in estate and tax planning;
Mr. Kramer, an experienced C.P.A. practicing in the tax field for
over 35 years; and Mr. Brewster, an experienced C.P.A. practicing
in the tax field for over 25 years--to provide them proper tax
advice and to properly prepare their tax returns.
The penalty under section 6662 is not imposed with respect
to any portion of any underpayment if it is shown that there was
reasonable cause for such portion and that the taxpayer acted in
good faith with respect to such portion. A taxpayer’s reliance
on the advice of an independent professional as to the tax
treatment of an item, if such reliance was reasonable and the
taxpayer acted in good faith, will establish that the taxpayer
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