John P. Crowley and Elizabeth R. Cockrell - Page 10

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          under section 6013(e) that were contested,7 tried, and briefed by           
          the parties but were not addressed in our prior Opinion.  The               
          present record in the instant case is sufficient for us to decide           
          the other undecided requirements for innocent spouse relief under           
          section 6013(e).8  For the reasons set forth below, we conclude             

          7                                                                           
               Respondent concedes that petitioner meets certain of the               
          requirements for relief as an innocent spouse provided by sec.              
          6013(e).                                                                    
          8                                                                           
               Petitioner requests that we reopen the record to permit her            
          to introduce, inter alia, her transcript from the University of             
          Guelph to show that she took no courses in any tax, business, or            
          financial subject, majored in English, and was "an extremely                
          indifferent student".  Petitioner contends that, after the trial            
          of the instant case, the Court of Appeals for the Second Circuit            
          announced a requirement for innocent spouse relief that a                   
          taxpayer's education be taken into account in deciding whether              
          the taxpayer knew or had reason to know of the existence of a               
          substantial understatement under sec. 6013(e)(1)(C).  Friedman v.           
          Commissioner, 53 F.3d 523, 531-532 (2d Cir. 1995), affg. in part,           
          revg. in part, and remanding T.C. Memo. 1993-549; Hayman v.                 
          Commissioner, 992 F.2d 1256 (2d Cir. 1993), affg. T.C. Memo.                
          1992-228.  Petitioner argues that the "new" requirement renders             
          relevant petitioner's university transcript and the other                   
          evidence she seeks to admit and that such relevance could not               
          have been anticipated at the time of such trial.  Petitioner                
          admits, however, that the requirement for innocent spouse relief            
          adopted by the Second Circuit had been articulated by other                 
          courts prior to the trial of the instant case.  See, e.g., Price            
          v. Commissioner, 887 F.2d 959, 965 (9th Cir. 1989), revg. an Oral           
          Opinion of this Court.                                                      
               We do not agree with petitioner that she could not have been           
          aware of the relevance of the evidence she now seeks to introduce           
          simply because the Court of Appeals for the Second Circuit, at              
          the time the instant case was tried, had yet to issue its                   
          opinions requiring that a taxpayer's education level be taken               
          into consideration.  Moreover, petitioner contends that, even               
          without such evidence, the record developed at the trial of the             
          instant case is sufficient to support a finding that she did not            
          know and had no reason to know of the existence of the                      
                                                             (continued...)           




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