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payment is alimony under section 71(a)(1) is determined by
considering all the facts and circumstances, and not solely by
reference to how it is characterized by the separation agreement
or by reference to State law.
After concessions,2 the issues for decision are:
1. Whether payments Dr. Ehrenworth made to Mrs. Spector in
1986, 1987, and 1988 were alimony or a property settlement. We
hold that they were in part alimony and in part a property
settlement.
2. Whether Dr. Ehrenworth is liable for additions to tax
for 1986 and 1987 for negligence under section 6653(a) with
respect to claimed dependency exemption deductions. We hold that
he is.
3. Whether the Spectors are liable for an addition to tax
for 1986 for negligence under section 6653(a) with respect to a
claimed dependency exemption deduction. We hold that they are
not.
References to petitioners are to the Spectors and the
Ehrenworths. References to Mrs. Spector are to Marcia Spector.
References to Dr. Ehrenworth are to Lionel Ehrenworth. Unless
otherwise indicated, section references are to the Internal
2 Respondent concedes that petitioners are not liable for
additions to tax for negligence or substantial understatement
for 1986, 1987, and 1988 for any deficiencies related to the
characterization of the payments from Dr. Ehrenworth to
Mrs. Spector.
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