- 29 -
Commissioner, supra at 1536; Bokum v. Commissioner, 94 T.C. 126,
148 (1990), affd. 992 F.2d 1132 (11th Cir. 1993). A spouse may
have a duty to inquire further if he or she knows enough facts so
as to be placed on notice of the possibility of a substantial
understatement. Guth v. Commissioner, 897 F.2d 441, 444-445 (9th
Cir. 1990), affg. T.C. Memo. 1987-522.
Factors to be considered in determining whether petitioner
had no reason to know within the meaning of section 6013(e)(1)(C)
include the spouse's level of education; the spouse's in-
volvement in the financial and business activities of the
family; any substantial unexplained increase in the
family's standard of living; and the culpable spouse's
evasiveness and deceit about the family's finances. * * *
[Resser v. Commissioner, supra at 1536.]
According to the notice, Mr. Morris embezzled $102,972.40,
$128,092.34, and $129,046.26 during the years 1987, 1988, and
1989, respectively, and, of the total embezzled funds, reported
$32,425 as gross receipts of Accu-Data during 1987, $54,907.13 as
the aggregate gross receipts of Accu-Data and Meadows during
1988, and $85,944.95 as the aggregate gross receipts of Accu-Data
and Meadows during 1989.
During the years at issue, Mr. Morris deposited all of the
embezzled funds into the bank accounts of the following corpora-
tions and other entities that he controlled: Accu-Data, Trust
768, Meadows, and MCIC. Checks drawn on those accounts were
received by or were expended on behalf of petitioner during those
years, as follows:
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