- 7 - Thus, Linda has failed to establish that the deductions are grossly erroneous. Accordingly, we conclude that Linda, pursuant to section 6013(e), is not entitled to be relieved of tax liability with respect to the disallowed deductions. Respondent also determined that petitioners did not report $22,715 of income from Ronnie's law practice. Omissions from gross income are grossly erroneous. Sec. 6013(e)(2). The understatement of tax attributable to the omitted income is substantial because it exceeds $500. Sec. 6013(e)(3). In addition, respondent has conceded that the omission is attributable to items of Ronnie. Accordingly, with respect to the omitted income, we conclude that Linda has established a substantial understatement of tax attributable to grossly erroneous items of Ronnie. We next determine whether Linda meets the remaining requirements of section 6013(e). II. Knowledge Requirement Linda must establish that in signing the return, she did not know, and had no reason to know, of the substantial understatement of tax attributable to the omitted income from Ronnie's law practice. Sec. 6013(e)(1)(C). More specifically, she must establish that she did not know, or have reason to know, about the income-producing transaction that Ronnie failed to report. Park v. Commissioner, supra at 1294; Bokum v. Commissioner, supra at 146. A spouse seeking relief has reasonPage: Previous 1 2 3 4 5 6 7 8 9 10 Next
Last modified: May 25, 2011