David ALTMAN; Beverly Altman, Petitioners, v. COMMISSIONER OF INTERNAL REVENUE, Respondent, 469 F. App'x 565

MEMORANDUM Dr. David Altman and Beverly Altman appeal an order of the United States Tax Court holding them liable for negligently claiming a loss on their 1982 tax return. The Altmans had invested in a project of CAL-NEVA Partners, a Nevada limited partnership involved in growing jojoba beans. The tax court found the Altmans negligent in claiming the tax loss. We reverse. The tax court clearly erred in concluding that Dr. Altman’s own thorough investigation was insufficient to permit him to make a reasonable decision that the project had some fair prospect of profitability.

And the tax court clearly erred in concluding that Dr. Altman’s consultation with Mr. Mohler, and his related conduct in claiming the deduction, was inadequate. See Sacks v. Commissioner, 82 F.3d 918, 920 (9th Cir.1996). Because the tax court’s determinations regarding the Altmans’ negligence are not supported by the record, we reverse its holding that the Altmans were negligent within the meaning of former § 6658(

a) of the Internal Revenue Code for claiming a loss relating to their investment in CAL-NEVA. The decision ordering additions to tax totaling $82,596 is therefore REVERSED. This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3.