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conceded that petitioner meets the first two requirements of
section 6013(e)(1).
A taxpayer seeking innocent spouse relief must establish
that he or she in signing the return did not know, and had no
reason to know, that there was a substantial understatement of
tax. Sec. 6013(e)(1)(C). Petitioner says she did not know
because she did not look at the tax returns when she signed them.
However, a taxpayer cannot simply turn a blind eye to what is
disclosed on the tax returns or to what is omitted from the tax
returns. The innocent spouse provision is "designed to protect
the innocent, not the intentionally ignorant." Cohen v.
Commissioner, T.C. Memo. 1987-537.
A spouse has reason to know of a substantial understatement
if a reasonably prudent taxpayer under the taxpayer's
circumstances at the time of signing the return could be expected
to know the return was erroneous or that further investigation
was warranted. Stevens v. Commissioner, supra at 1505; Bokum v.
Commissioner, supra at 148. The test establishes a duty of
inquiry. Stevens v. Commissioner, supra. If a spouse knows
enough facts to be put on notice of the possibility of a
substantial understatement, she has a duty to inquire further.
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 the spouse
had reason to know are the alleged innocent spouse's level of
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