- 15 - Mr. Hendricks dominated the financial side of the marriage with petitioner playing a minor role in the family’s finances. Petitioner did not participate in any of Mr. Hendricks’s business activities. Although Mr. Hendricks was not deceitful regarding their finances, he did not consult with petitioner about making the investment in Boulder Oil and Gas and did not disclose that the investment had been made. Moreover, petitioner played a minimal role in the preparation of the tax returns. The only information petitioner provided was a list of personal and household expenses. She relied upon Mr. Hendricks to provide the remainder of the information. The Hendrickes have led frugal lifestyles. We find no evidence in the record that the Hendrickses made any lavish or unusual expenditures during the relevant years. Considering all of the circumstances concerning the joint 1983 tax return, a reasonably prudent taxpayer under petitioner’s circumstances–-living a modest life, raising a family of five children, uninvolved in the financial affairs of the family, and without any financial background–-at the time of signing could not be expected to know about the understatement attributable to Mr. Hendricks’s investment in Boulder Oil and Gas. Is there, however, a duty of inquiry? In order for petitioner’s duty of inquiry to arise, she must first harbor doubts about the accuracy of the return. Stevens v.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011