- 42 -
the requirement in the Senate Committee on Finance report and
conference report that the putative innocent spouse know something
was “incorrect”. See majority op. at 20.
IV. Wiksell v. Commissioner
The taxpayer in Wiksell v. Commissioner, 215 F.3d 1335 (9th
Cir. 2000) (unpublished), affg. T.C. Memo. 1999-32, knew that checks
she received from her husband’s business had not been reported on
their 1994 and 1995 tax returns. See id. at 2000-1336, 88-983. She
also had actual knowledge that the return was incorrect. See the
findings of fact in Wiksell v. Commissioner, T.C. Memo. 1994-99.
The issue in Cheshire is whether knowledge of an “item giving
rise to a deficiency” refers to the putative innocent spouse’s
knowledge of the underlying activity, or knowledge that the income,
deduction, loss, or credit from the activity is incorrectly reported
on the tax return. The opinion of the U.S. Court of Appeals for the
Ninth Circuit in Wiksell v. Commissioner, supra, does not discuss
the “knowledge that any item on the return is incorrect” language
from the legislative history. The opinion of the Court of Appeals
does not say the parties disputed, or that the Court of Appeals
considered, whether the actual knowledge of “any item giving rise to
a deficiency” required by section 6015(c) is knowledge of an income-
producing transaction, or knowledge that it was reported
incorrectly. In fact, since Mrs. Wiksell knew her return was wrong,
the Court of Appeals had no need to consider that issue.
Page: Previous 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 NextLast modified: May 25, 2011