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return for 2001, petitioner knew that there was an underpayment
of tax attributable to these items. Respondent, therefore, is
sustained in denying petitioner relief for the year 2001 under
section 6015(b).
The Court next addresses whether petitioner is entitled to
relief under section 6015(c). Section 6015(c) provides relief
from joint liability for spouses either no longer married,
legally separated, or living separate and apart. Generally, this
avenue of relief allows a spouse to elect to be treated as if a
separate return had been filed. Rowe v. Commissioner, T.C. Memo.
2001-325. Section 6015(c)(2) places the burden of proof with
respect to establishing the portion of the deficiency allocable
to the electing spouse upon that spouse. An election is not
valid if the Commissioner demonstrates that the electing spouse
had actual knowledge of an item giving rise to the deficiency.
Sec. 6015(c)(3)(B).
As to these 3 years, respondent considered the same facts
discussed above relating to petitioner’s claim for relief under
section 6015(b). Based on these facts, the examiner concluded
that petitioner knew or had reason to know of the various
transactions that gave rise to the deficiencies, and that
petitioner benefited from the redetermined items of income and
disallowed expenses. As noted earlier, some of the deposits to
petitioner’s bank account came from Mr. Clark’s trade or
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