Kopel was engaged to prepare Raff's Year 4 federal income tax return. During the tax preparation interview, Raff told Kopel that he paid USD3,000 in property taxes in Year 4. Actually, Raff's property taxes amounted to only USD600. Based on Raff's word, Kopel deducted the USD3,000 on Raff's return, resulting in an understatement of Raff's tax liability. Kopel had no reason to believe that the information was incorrect. Kopel did not request underlying documentation and was reasonably satisfied by Raff's representation that Raff had adequate records to support the deduction. Which of the following statements is correct?
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