- 29 -
she would bear the entire burden of the tax liabilities resulting
from the understatement attributable to the Magnum deductions.
Considering that petitioner did not receive significant
benefit from the understatements and the future probable hardship
that would be imposed if relief were denied, we find that it
would be inequitable to hold petitioner liable for the resulting
deficiencies. Therefore, petitioner has satisfied section
6013(e)(1)(D). In summary, we find that petitioner has
established (1) that she did not know and did not have reason to
know that there was a substantial understatement relating to the
Magnum deductions and (2) that it is inequitable to hold her
liable for the resulting deficiencies. Taking into account the
parties' stipulations, supra, we, therefore, hold that petitioner
has met all of the requirements of section 6013(e), and she is
entitled to relief as an innocent spouse for any income tax
liability attributable to the understatements for the years in
issue arising from the Magnum investment.
To reflect the foregoing,
Decisions will be entered
under Rule 155.
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