Perry v. Commissioner
This text of 1997 T.C. Memo. 417 (Perry v. Commissioner) is published on Counsel Stack Legal Research, covering United States Tax Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Opinion
Decision will be entered for petitioners.
MEMORANDUM FINDINGS OF FACT AND OPINION
WHALEN, JUDGE: Respondent determined the following deficiencies in and additions to petitioners' joint Federal income tax for the years in issue:
| Sec. | Sec. | Sec. | ||
| Year | Deficiency | 6653(a)(i)(A) | 6653(a)(1)(B) | 6653(a)(1) |
| 1986 | $ 1,575.26 | $ 78.86 | 1 | -- |
| 1988 | 6,649.00 | -- | -- | $ 332.45 |
All section references are to the Internal Revenue Code as in effect during the years in issue. Respondent also determined the following deficiencies in, additions to, and penalty on petitioner Kenneth E. Perry's separate Federal income tax for the years in issue:
| Additions to Tax | Penalty | |||
| Sec. | Sec. | |||
| Year | Deficiency | 6653(a)(1)(A) | 6653(a)(1)(B) | Sec. 6662 |
| 1987 | $ 3,920 | $ 196 | 1 | -- |
| 1989 | 4,020 | -- | -- | $ 804 |
| 1990 | 825 | -- | -- | 165 |
| 1991 | 1,367 | -- | -- | 273 |
After concessions, the issues remaining for decision are: *487 (1) Whether petitioners' horse breeding and boarding activity during 1986 and 1988 was an "activity not engaged in for profit" within the meaning of
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Decision will be entered for petitioners.
MEMORANDUM FINDINGS OF FACT AND OPINION
WHALEN, JUDGE: Respondent determined the following deficiencies in and additions to petitioners' joint Federal income tax for the years in issue:
| Sec. | Sec. | Sec. | ||
| Year | Deficiency | 6653(a)(i)(A) | 6653(a)(1)(B) | 6653(a)(1) |
| 1986 | $ 1,575.26 | $ 78.86 | 1 | -- |
| 1988 | 6,649.00 | -- | -- | $ 332.45 |
All section references are to the Internal Revenue Code as in effect during the years in issue. Respondent also determined the following deficiencies in, additions to, and penalty on petitioner Kenneth E. Perry's separate Federal income tax for the years in issue:
| Additions to Tax | Penalty | |||
| Sec. | Sec. | |||
| Year | Deficiency | 6653(a)(1)(A) | 6653(a)(1)(B) | Sec. 6662 |
| 1987 | $ 3,920 | $ 196 | 1 | -- |
| 1989 | 4,020 | -- | -- | $ 804 |
| 1990 | 825 | -- | -- | 165 |
| 1991 | 1,367 | -- | -- | 273 |
After concessions, the issues remaining for decision are: *487 (1) Whether petitioners' horse breeding and boarding activity during 1986 and 1988 was an "activity not engaged in for profit" within the meaning of
FINDINGS OF FACT
Some of the facts have been stipulated and are so found. The stipulation of facts and attached exhibits are incorporated herein by this reference. Petitioners are husband and wife who filed joint Federal income tax returns for 1986 and 1988. Petitioner Kenneth E. Perry filed separate Federal income tax returns for 1987, *488 1989, 1990, and 1991. At the time they filed their petition in this case, petitioners resided in Brookville, Ohio.
Petitioners were both raised on family farms, and both have been around horses most of their lives. Mr. Perry learned to break and care for horses when he was 10 to 12 years old and was involved in purchasing, breeding, training, and selling horses with his father and brother for over 20 years prior to 1986. Ms. Hofer also learned to break and care for horses at a very young age and was also involved in purchasing, breeding, training, and selling horses for some time prior to the years in issue.
Mr. Perry studied business administration and industrial management at Franklin University, Dayton University, Michigan State University, and San Jose State University. The record does not disclose whether he received a degree from any of these institutions. Mr. Perry began working for the General Motors Corp. sometime in or around the mid-1970's.
Ms. Hofer holds a dual bachelor's degree in production operative management and logistics from Ohio State University. In 1984, she began working as a production supervisor for General Motors. Mr. Perry and Ms. Hofer became acquainted in *489 1984 through their mutual employment with General Motors and were married sometime prior to 1986. Petitioners subsequently had two children together, Muriel, born December 9, 1987, and Lauren, born October 9, 1989.
Petitioners were both full-time employees of General Motors throughout the years in issue. Petitioners received the following wages from their employment with General Motors during the years in issue:
| Year | Mr. Perry | Ms. Hofer | Total |
| 1986 | $ 56,140 | $ 40,608 | $ 96,748 |
| 1987 | 52,014 | 39,910 | 91,924 |
| 1988 | 52,485 | 43,064 | 95,549 |
| 1989 | 55,167 | 43,358 | 98,525 |
| 1990 | 61,487 | 45,562 | 107,049 |
| 1991 | 56,905 | 48,653 | 105,558 |
Mr. Perry retired from General Motors in 1995. At the time of trial, Ms. Hofer was on dependent care leave and did not wish to return to work.
At the time they were married, petitioners planned to acquire a farm and raise horses. Before implementing this plan, petitioners had at least one conversation with Mr. John Adkins, who had extensive experience breeding Tennessee Walking Horses. Based on their discussions with Mr. Adkins and their prior experience, petitioners decided to acquire and develop a breeding stock of registered Tennessee Walking Horses. Petitioners knew that the undertaking would require a substantial *490 outlay of cash and that there was a significant likelihood of losses during the early stages. However, petitioners did not have a formal business plan or income projection at the time they began the undertaking. Petitioners believed that they could create a self-sustaining breeding operation by acquiring and developing sufficient real estate, planting appropriate crops, and acquiring attractive horses. At the time they began their horse-related operation, petitioners believed that they could eventually generate a profit of approximately $8,000 to $10,000 per year.
Petitioners began their horse-related operation on June 28, 1986, when they acquired a registered Tennessee Walking Horse stallion from Mr. Adkins. After purchasing this stallion, petitioners acquired and developed various parcels of real property to facilitate their activity. In the following discussion, we describe petitioners' real estate transactions before describing their acquisitions and transfers of horses.
REAL ESTATE TRANSACTIONS
On November 21, 1986, petitioners purchased 1.72 acres of real estate located in Union County, Ohio, for a total price of $103,733.95. Petitioners satisfied $11,855.24 of the purchase *491 price with cash and executed a promissory note for the balance. Petitioner obtained a portion of the cash downpayment from a savings account and obtained the remainder by cashing in Mr. Perry's retirement options and Ms. Hofer's stock options with General Motors. The 1.72-acre parcel included a small house which petitioners used as their personal residence from the time they acquired the property until 1994. Petitioners constructed a small barn and two separate paddocks on the 1.72-acre parcel. The barn consisted of two open stalls and a separate area for storing hay and was completed in early 1987 at a total cost of approximately $13,000.
On or about June 15, 1987, petitioners purchased 4 additional acres of real estate contiguous to the 1.72-acre parcel for a total price of $10,000. The party from whom petitioners purchased this land retained the right to harvest a crop already growing on the property. In 1988, after this crop was harvested, petitioners tilled the soil and converted the land to pasture. Petitioners also constructed a second, larger barn on the 4-acre parcel. This barn consisted of six bay stalls, one wash stall, a tack room, and an "open run-in". The barn was *492 completed in 1989 at a total cost of $30,700.
On or about April 15, 1989, petitioners purchased an additional 19.491 acres of land contiguous to the 4-acre parcel and adjacent to the 1.72-acre parcel for a total price of $48,727.50. Shortly thereafter, petitioners prepared a portion of the land for pasture and the remainder for cultivating alfalfa. Petitioners did not erect any structures on the 19.491-acre parcel.
Between 1986 and 1990, petitioners converted a total of approximately 24 acres of the Union County real estate from tillage to pasture and hay fields. Due to severe drought conditions in 1987 and 1988, the pastures and hay fields were not productive as sources of feed for petitioners' horses until 1990. These drought conditions also caused an increase in the cost of feed and depressed the market for horses.
In 1994, General Motors transferred Ms. Hofer to its plant in Dayton, Ohio. Because of this transfer, and because Mr. Perry was planning to retire from General Motors in 1995, petitioners decided to relocate their home and horse breeding operation to a location nearer Ms. Hofer's work. On or about June 3, 1994, petitioners purchased 20 acres of real estate located in *493 Montgomery County, Ohio, for a total price of $141,273.14. This included a house which petitioners used as their personal residence from the time of the purchase up to the time of trial, and a "home barn".
After acquiring the Montgomery County property, petitioners began selling their real estate in Union County. On or about July 26, 1994, petitioners sold the 1.72- and 4-acre parcels, together with the house and barns, for a total price of $212,500. In December 1995, petitioners sold 10 of the remaining 19.491 acres for a total price of $35,000. At the time of trial, petitioners were offering the remaining 9.491 acres for sale in three parcels for a total price of $83,000. Petitioners were also continuing to cultivate alfalfa on the remaining Union County property and intended to plant corn on 15 to 18 acres of their Montgomery County property.
HORSE ACQUISITIONS, TRANSACTIONS, AND RELATED FACTS
Petitioners acquired, bred, boarded, and sold numerous horses during the years in issue. These included Tennessee Walking Horses, thoroughbreds, and one Morgan. To avoid confusion, we discuss each breed separately.
TENNESSEE WALKING HORSES
On June 28, 1986, petitioners purchased a 12-year-old *494 registered Tennessee Walking Horse stallion named Copy's Big Shot S (Big Shot) from Mr. Adkins for $1,500. At the time of purchase, petitioners intended to use Big Shot as a breeding stallion. Although Big Shot suffered from a bronchial condition, petitioners believed that $1,500 was a favorable price given the horse's bloodline and "confirmation". Big Shot sired a total of eight foals for petitioners before his death in 1992.
On October 15, 1987, petitioners purchased a 1-year-old Tennessee Walking Horse mare named Copy's Sugar Plum (Sugar Plum) for $300. At the time of purchase, petitioners intended to use Sugar Plum as a broodmare. Sugar Plum produced a total of five foals for petitioners prior to the time of trial. One of these foals was killed in l991 after suffering a broken leg. Petitioners sold Sugar Plum's second foal, a gelding named Copy's Black Prince, for $650 in 1993 after determining that it lacked adequate confirmation. Also in 1993, petitioners sold another of Sugar Plum's foals, a filly named Copy's Sugar Shot, for $1,000. At the time of trial, petitioners were using Sugar Plum and two of its offspring, Copy's Allen Rose and Copy's Eyote Anoka, as broodmares.
In *495 1988, petitioners purchased an unregistered Tennessee Walking Horse mare named Amy for $1,000. Amy was in foal at the time of petitioners' purchase and subsequently gave birth. In 1989, after determining that it was not economically feasible to register Amy or the foal, petitioners sold both horses for a total price of $500.
Also in 1988, petitioners purchased a registered Tennessee Walking Horse mare named Damon's Red Lady for $650. Damon's Red Lady subsequently produced three foals for petitioners. Petitioners sold the first of these foals, Shot Strutter, for $650 in 1991. The purchaser thereafter paid petitioners to board Shot Strutter on their property.
THOROUGHBREDS
Sometime in 1987, petitioners acquired two thoroughbred mares named Spiro Gyro and Queens Dynasty for $500 each. At the time of purchase, petitioners erroneously believed that both mares were in foal. Petitioners later learned that neither mare was in foal. They sold Queens Dynasty for $75 after she became ill. They bred Spiro Gyro, who produced a foal named Flying Footprint in 1989, and sold Spiro Gyro in 1990 for $500. In 1991, after determining that breeding thoroughbreds would not be profitable, petitioners *496 sold Flying Footprint for $1,000. However, petitioners repossessed Flying Footprint after receiving only $150 of the purchase price and resold the horse to a second buyer in 1992 for $1,000.
MORGAN
Sometime in 1988, petitioners purchased a registered Morgan mare named Dancer for $300. Petitioners sold Dancer in early 1989 for $375. The purchaser thereafter paid petitioners to board Dancer on their property. The record does not disclose the fee petitioners received for this service.
Petitioners are members of the Tennessee Walking Horse Breeders and Exhibitors Association. With the exception of veterinary and complicated farrier services, petitioners personally performed all of the tasks attendant to their horse-related activity during the years in issue, including feeding and watering, grooming, inoculations, hoof care, foaling, and breaking. Petitioners have never shown any of their horses in competitions and do not ride their horses for recreation.
Petitioners advertised their horse-related operation by placing a sign near a road which runs adjacent to their property. This sign reads "Tennessee Walking Horses boarded and stud sic and for sale". Petitioners also periodically *497 placed advertisements in local magazines and newspapers when they desired to sell a foal or offer a stallion for stud services.
INCOME AND LOSSES
Petitioners reported a net loss from their horse-related operation during each of the years in issue, calculated as follows:
| 1986 | 1987 | 1988 | 1989 | 1990 | 1991 | |
| Income: | ||||||
| Sale of horses | -- | -- | $ 75 | $ 875 | $ 250 | $ 500 |
| Boarding fees | -- | -- | -- | -- | 1,200 | 1,000 |
| Sale of alfalfa | -- | -- | -- | -- | 2,599 | -- |
| Sale of hay | -- | -- | -- | -- | -- | 1,700 |
| Sale of tractor | -- | -- | -- | -- | 1,600 | -- |
| Unexplained income | -- | -- | -- | -- | -- | 70 |
| Gross Income | -- | -- | 75 | 875 | 5,649 | 3,270 |
| Expenses: | ||||||
| Breeding fees | -- | $ (500) | -- | (234) | -- | -- |
| Depreciation & | ||||||
| sec. 179 | ||||||
| expenses | -- | (1,308) | (3,363) | (3,321) | (3,692) | (3,203) |
| Feed purchased | $ (1,886) | (5,019) | (7,596) | (3,153) | (880) | (1,083) |
| Fertilizers & lime | -- | -- | -- | -- | -- | (135) |
| Freight & trucking | (50) | -- | -- | -- | -- | -- |
| Gasoline, fuel, | ||||||
| oil | (280) | -- | -- | -- | -- | -- |
| Insurance | -- | -- | -- | (250) | (250) | -- |
| Labor hired | -- | -- | (2,300) | -- | -- | (381) |
| Rent of farm, | ||||||
| pasture | (990) | -- | -- | (500) | -- | -- |
| Repairs, | ||||||
| maintenance | -- | -- | -- | -- | (923) | (589) |
| Seeds, plants | ||||||
| purchased | (120) | -- | (200) | (1,681) | -- | -- |
| Storage, | ||||||
| warehousing | -- | (1,200) | -- | -- | -- | -- |
| Supplies purchased | -- | -- | (3,500) | (1,045) | (162) | -- |
| Veterinary fees, | ||||||
| medicine | (85) | (1,658) | (1,347) | (504) | -- | (507) |
| Other expenses | -- | (516) | (5,450) | (1,975) | (874) | (550) |
| Total expenses | (3,411) | (10,201) | (23,756) | (12,663) | (6,781) | (6,448) |
| Net income (loss) | (3,411) | (10,201) | (23,681) | (11,788) | (1,132) | (3,178 |
*498 Petitioners reported the losses in 1986 and 1988 on Schedules F attached to their joint income tax returns. Mr. Perry reported the losses in 1987, 1989, 1990, and 1991 on Schedules F attached to his individual income tax returns. We note that Mr. Perry's return reports gross income of $3,270 for 1991, whereas the stipulation of facts filed by the parties states that petitioner received only $3,200 of gross income in that year. The record does not disclose the reason for this discrepancy, and we accept the figure stated in petitioner's return. The additional $70 which is not explained in the stipulation is listed as "unexplained income" in the above schedule. Mr. Perry reported net losses from his horse breeding and boarding activity in 1992 and 1993 of $1,720 and $517, respectively, and a net profit of $1,274 in 1994.
Respondent began the examination of petitioners' tax returns sometime in or around 1988. On December 19, 1989, petitioners filed with respondent Form 5213, Election to Postpone Determination as to Whether the Presumption That an Activity is Engaged in for Profit Applies, for an activity described as "Breeding and showing horses" beginning with the 1986 tax *499 year.
BOOKS AND RECORDS
Initially, petitioners' financial record keeping consisted of retaining receipts of expenses related to the horse activity in a box in their home. At the end of the year, petitioners would sort through these receipts with an accountant to calculate their tax liability. In or around 1988, after the start of respondent's audit, petitioners began recording receipts and expenditures related to their horse operation on a calendar where they also recorded important events such as the dates foals were born and the dates of inoculations. In or around 1989, petitioners also began transferring these records to financial ledgers. Petitioners did not maintain a separate bank account for their horse-related activity during any of the years in issue and did not introduce any of their financial records into evidence.
OPINION
The primary factual issue in this case is whether petitioners' horse breeding and boarding operation was an "activity not engaged in for profit" as defined by
Whether a taxpayer engages in an activity with the requisite profit motive is a question of fact to be resolved on a consideration of all the facts and circumstances in the record. See
SINGLE ACTIVITY
Before determining whether, and to what extent,
In ascertaining the activity or activities of the taxpayer, all the facts and circumstances of the case must be taken into account. Generally, the most significant facts and circumstances in making this determination are the degree of organizational and economic interrelationship of various undertakings, the business purpose which is (or might be) served by carrying on the various undertakings separately or together in a trade or business or in an investment setting, and the similarity of various undertakings. Generally, the Commissioner will accept the characterization *503 by the taxpayer of several undertakings either as a single activity or as separate activities. The taxpayer's characterization will not be accepted, however, when it appears that his characterization is artificial and cannot be reasonably supported under the facts and circumstances of the case. Id.
Petitioners characterize all of the undertakings relating to their horse breeding and boarding, including holding the land on which those undertakings were conducted, as a single activity for
Where land is purchased or held primarily with the intent to profit from increase in its value, and the taxpayer also engages in farming on such land, the farming and the holding of the land will ordinarily be considered a single activity only if the farming activity reduces the net cost of carrying the land for its appreciation in value. Thus, the farming and holding of the land will be considered a single activity only if the income derived from farming exceeds the deductions attributable to the farming activity which are not directly attributable to the holding of the land (that is, deductions other than those directly attributable to the holding of the land such as interest on a mortgage secured by the land, annual property taxes attributable to the land and improvements, and depreciation of improvements to the land).
Under its terms, the above rule applies only where "land is purchased or held primarily with the intent to profit from increase in its value". See
In this case, we find that petitioners' primary intent was not to profit from the increase in the value of the land used to conduct their horse breeding and boarding. Rather, petitioners' primary intent was to breed and board horses. Cf.
We find petitioners' characterization *506 of their horse breeding and boarding, and holding of the land as a single activity to be fully supported by the facts of this case. See generally
FACTORS RELATING TO THE HORSE BREEDING AND BOARDING ACTIVITY
1. MANNER IN WHICH THE TAXPAYER CARRIED ON THE ACTIVITY
Petitioners did not have a formal business plan or income projection prior to the time they began their horse breeding and boarding operation. Petitioners also did not introduce any of their financial books or records into evidence. Petitioners testified that during the initial stages of their operation, they simply retained receipts and invoices arising from the activity in a box, which they *508 sorted with their accountant at the end of the year to calculate their income tax liability. Both petitioners also testified that in or around 1988, they began recording receipts and expenditures related to the horse activity on a calendar, and that they later began transferring these records to a financial ledger. Petitioners further testified that they maintained meticulous records of events relating to their horses, such as births and inoculations, throughout the years in issue. We find petitioners' testimony credible in this regard.
We note that petitioners stopped purchasing thorough- breds when they determined that they could not profit from that undertaking. Petitioners also placed advertisements in local newspapers and magazines when they desired to sell a horse or offer a stallion for stud services.
2. EXPERTISE OF THE TAXPAYER OR HIS ADVISORS
Petitioners were both raised on family farms, and both had extensive experience in purchasing, breeding, training, and selling horses. Petitioners also sought and followed the advice of Mr. Adkins, an experienced breeder of Tennessee Walking Horses, prior to the time they began their horse breeding and boarding activity. Moreover, petitioners *509 learned to inoculate their horses and perform other basic health care procedures themselves. Petitioners also joined the Tennessee walking Horse Breeders Association and educated themselves on bloodlines and markets for Tennessee Walking Horses. Petitioners appeared at trial to be generally knowledgeable about purchasing, breeding, training, caring for, and selling horses. In light of all this, we find that petitioners did have sufficient expertise to indicate that they engaged in their horse breeding and boarding activity with an actual and honest objective of making a profit.
3. TIME AND EFFORT EXPENDED BY THE TAXPAYER
While petitioners were both full-time employees of General Motors during the years in issue, petitioners lived on the property where they pursued their horse breeding and boarding activity, and they performed all of the work necessary for the activity themselves, with the exception of veterinary and complicated farrier services.
4. EXPECTATION THAT ASSETS USED IN THE ACTIVITY WILL APPRECIATE IN VALUE
The term "profit" encompasses appreciation in the value of assets, such as land, used in the *510 activity. Thus, the taxpayer may intend to derive a profit from the operation of the activity, and may also intend that, even if no profit from current operations is derived, an overall profit will result when appreciation in the value of land used in the activity is realized since income from the activity together with the appreciation of land will exceed expenses of operation.
In this case, we note that petitioners realized an economic gain of approximately $65,000 when they sold their Union County property in 1994, computed as follows;
Sale Price
| 5.72-acre parcel | |
| with barns | $ 212,500 |
| 10-acre parcel | 35,000 |
| Total Price | $ 247,500 |
Purchase Price
| 1.72-acre parcel | (103,734) |
| Small barn | (13,000) |
| 4-acre parcel | (10,000) |
| Large barn | (30,700) |
| 10-acre parcel | 1 (25,000) |
| Total Price | (182,434) |
| Total economic gain | 65,066 |
We also note that at the time of trial, petitioners were offering for sale at a total price of $83,000 the remaining 9.491 acres of Union County property, in which they had an unadjusted cost basis of $23,727.50.
The *511 economic gain petitioners realized on the sale of the Union County property in 1994 more than offsets the total $53,391 in operating losses they claimed during the years in issue. Thus, appreciation in the value of the land used in the activity helps to explain petitioners' willingness to continue their horse breeding and boarding operation despite the operating losses sustained during the years in issue. Cf.
5. SUCCESS IN SIMILAR OR DISSIMILAR ACTIVITIES
Petitioners both testified that they had been involved in purchasing, breeding, training, and selling horses in the past. While there is no evidence in the record to substantiate their success in these activities, we find their testimony to be credible. There is no evidence that Mr. Perry or Ms. Hofer was successful in any dissimilar investment or business activities.
6. HISTORY OF INCOME OR LOSSES
Petitioners reported a net loss from their horse activity during each of *512 the years in issue. We also note that petitioners suffered 2 years of extreme drought, during which they were unable to produce their own feed, the market price of feed increased, and the market for horses decreased. Cf.
7. AMOUNT OF OCCASIONAL PROFITS
Petitioners did not report a net profit during any of the years in issue. However, petitioners did report a net profit of $1,274 in 1994 and testified at trial that they expected to realize a profit of $8,000 to $10,000 per year once they established a viable stock of Tennessee Walking Horses for breeding. We also note that petitioners' losses decreased gradually between 1991 and 1995, and that they realized substantial gains from the sale of the Union County property in 1994.
8. *513 FINANCIAL STATUS OF THE TAXPAYER
Although petitioners were both full-time employees of General Motors throughout the years in issue, neither of them earned particularly high wages during any of those years. Petitioners also testified that they were forced to cash in their stock options and retirement options with General Motors to finance the purchase of the Union County property. Moreover, petitioners had two minor children during each of the years in issue. We find that petitioners did not have substantial income or capital from sources other than their horse breeding and boarding activity during the years in issue.
9. ELEMENTS OF PERSONAL PLEASURE OR RECREATION
Petitioners argue that they did not derive significant personal pleasure or recreational benefits from their horse breeding and boarding operation. Petitioners point out that their entire experience with horses was purely commercial, and that they did not participate in any horse shows during the years in issue. Petitioners also point out that Big Shot had a bronchial condition which caused him to be too dangerous to ride. Moreover, petitioners fed their horses alfalfa, which they contend made the horses unfit for riding, and *514 did not shoe any of their horses. We find petitioners' testimony credible in this regard and find that they did not ride their horses for pleasure or recreation. However, petitioners both clearly enjoyed working with horses and certainly derived some personal enjoyment from their horse breeding and boarding activity.
Upon consideration of all the facts and circumstances of this case, we conclude that petitioners engaged in their horse breeding and boarding activity with an honest and actual objective of making a profit. We therefore overrule respondent's adjustments to petitioners' and Mr. Perry's tax for the years in issue.
We note that on the basis of the
ADDITIONS TO TAX AND PENALTY
Respondent determined that petitioners are liable for the additions to tax for negligence prescribed by
In light of the foregoing,
Footnotes
1. Plus 50 percent of the interest payable under sec. 6601 with respect to the portion of the underpayment which is attributable to negligence.↩
1. Plus 50 percent of the interest payable under sec. 6601 with respect to the portion of the underpayment which is attributable to negligence.↩
1. For purposes of this calculation, we accept petitioners' allocation of approx-imately one-half of the total $ 48,727.50 paid for the 19.491-acre parcel to the 10-acre portion sold in 1994.↩
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1997 T.C. Memo. 417, 74 T.C.M. 616, 1997 Tax Ct. Memo LEXIS 486, Counsel Stack Legal Research, https://law.counselstack.com/opinion/perry-v-commissioner-tax-1997.