- 41 -
The majority concludes that petitioner inquired in good faith
as to whether her return was correct, she was assured that it was
correct, and she had no obligation to inquire further. See majority
op. at 26. In explaining its holding that it was an abuse of
discretion for respondent not to grant equitable relief under
section 6015(f) as to petitioner’s liability for the section 6662(a)
accuracy-related penalty, the majority states:
we are satisfied that at the time she signed the 1992 tax
return, petitioner believed that the portion of retirement
distribution proceeds used to pay off the mortgage on the
family residence would be nontaxable. Further, we believe
that petitioner acted in good faith in reaching this
erroneous conclusion.
* * * * * * *
[Petitioner] asked Mr. Cheshire about the potential tax
ramifications of the retirement distributions, and in
response, Mr. Cheshire assured petitioner that he had
consulted with a certified public accountant and had been
advised that the payment of the outstanding mortgage on
the family residence and any amount rolled over into a
qualified account reduced the taxable amount of the
retirement distributions. Mrs. Cheshire had no reason to
doubt the truthfulness of Mr. Cheshire’s statement, and in
fact believed him. Under these circumstances, we do not
believe petitioner had an obligation to inquire further.
Majority op. at 25-26. In short, the majority holds that petitioner
thought the reporting of the distributions on her tax return was
correct. Thus, in holding for respondent, the majority disregards
4(...continued)
“the electing spouse must have an actual and clear awareness of
the omitted income.” See majority op. p. 19. If sec.
6015(c)(3)(C) is unambiguous, we need not create another
standard; if it is ambiguous, legislative history provides the
standard; i.e., that relief is not available if the Commissioner
proves that the electing spouse had actual knowledge that any
item on a return is incorrect.
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