Mr. Nugent is an enrolled agent in tax practice. Last year, the IRS imposed a $1,000 preparer

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Mr. Nugent is an enrolled agent in tax practice. Last year, the IRS imposed a $1,000 preparer penalty on him, and he immediately hired an attorney to contest the penalty. Mr. Nugent’s legal fee was $7,900. Was he acting irrationally by spending so much money to avoid the penalty?

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