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dispute with petitioner concerning the fee. Petitioner then
allegedly exercised ordinary business care and prudence in
obtaining another professional, who did file the return on
November 4, 1988. We are unpersuaded by petitioner's argument.
Although he has effectively explained why the return was not
timely filed, such explanation does not excuse the late filing.
We hold that their reliance on the first return preparer is not
reasonable cause, and therefore petitioners will be liable for
the addition for failure to timely file.
Innocent Spouse
Petitioner wife argues that she is entitled to treatment as
an innocent spouse for the 1987 tax year pursuant to section
6013(e).6 Generally, if a husband and wife file a joint return,
the tax is computed on their aggregate income, and they become
jointly and severally liable for payment of such tax. Sec.
6013(d)(3). A spouse may be relieved of such liability if the
requirements of section 6013(e)(1) are met. Those requirements
are:
(A) a joint return has been made under this section for
a taxable year,
(B) on such return there is a substantial
understatement of tax attributable to grossly erroneous
items of one spouse,
(C) the other spouse establishes that in signing the
return he or she did not know, and had no reason to know,
that there was such substantial understatement, and
6 Petitioner wife has waived this issue for 1988.
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