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assertions that Mr. Rooks was committing “fraud” in connection
with the returns are unfounded based upon the record before this
Court. Although the returns were delinquent, they actually
overstated the income tax liabilities of petitioner and Mr.
Rooks: The amended returns filed after Mr. Rooks’s death reduced
the liabilities owed by petitioner and Mr. Rooks. However, the
amended returns did incorrectly reflect the amounts shown as due
on the original returns as amounts which had been paid with those
returns. Petitioner’s testimony at trial reinforces this error--
she testified that the amended returns showed that she “had no
tax owed”, and that these returns resulted in refunds due to her.
In fact, the “refunds” were shown on the amended returns as such
only because of the above-mentioned error.
Based on petitioner’s unclear assertions and testimony
concerning the tax returns at issue, we find that petitioner
essentially turned a “blind eye” toward the filing of the Federal
income tax returns and the failure to pay the taxes shown on them
for the years in issue. A taxpayer who signs a return without
reviewing it, or who signs a blank return, is charged with
constructive knowledge of the tax due shown on that return.
Castle v. Commissioner, T.C. Memo. 2002-142. Thus, even if
petitioner did sign blank returns, she should have known of the
liabilities shown thereon.
Petitioner argues that she received no benefit from her
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