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benefit for purposes of deciding whether denial of innocent
spouse relief is inequitable under section 6013(e)(1)(D).
Flynn v. Commissioner, 93 T.C. 355, 367 (1989).
Petitioners contend that Ruth Levitt did not significantly
benefit from the unreported income. We disagree. The statute
by its terms no longer bars relief if the purported innocent
spouse received a significant benefit, but it continues to be
a factor. Estate of Krock v. Commissioner, 93 T.C. 672, 678
(1989). The benefit may be direct or indirect. Id. at 678.
Ruth Levitt enjoyed the benefits of the understatements during
the years in issue. She drove new cars, had a nursemaid, sent
her children to camp, and lived materially well. She had the
services of a chauffeur and handyman. Some of her children
attended private schools. She shopped extensively. Resyn
paid about $1,035,106 for those personal expenses of petitioners
from 1967 to 1969. She benefited from petitioners' tax
deductions for charitable contributions that Resyn paid in
1967 and 1968. Resyn also paid for petitioners to buy Welev
stock that Ruth Levitt sold in 1986, reporting a capital gain
of $999,338. There is no indication that Ruth Levitt's
benefit from unreported income was any different from 1964 to
1966. We believe that petitioners' unreported income allowed
her to have the standard of living that she did during the
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