MEMORANDUM FINDINGS OF FACT AND OPINION
WHERRY, Judge:
Respondent determined the following deficiencies and penalty with respect to petitioner's Federal income taxes for the calendar years 1996 and 1997:
Year Deficiency Penalty I.R.C. Sec. 6662 1996 $1,044,037 $106,877.80 1997 1,817 -
After concessions by the parties, the principal issues for decision are:
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